Preamble

The House met at half-past Two o'clock

PRAYERS

[Mr. SPEAKER in the Chair]

MESSAGES FROM THE QUEEN

PARLIAMENTARY PRIVILEGE ACT, 1770

The VICE-CHAMBERLAIN OF THE HOUSEHOLD reported Her Majesty's Answer to the Address, as follows:

I have received your humble Address praying that I will refer to the Judicial Committee of the Privy Council, for hearing and consideration, the question of law, whether the House of Commons would be acting contrary to the Parliamentary Privilege Act, 1770, if it treated the issue of a Writ against a Member of Parliament in respect of a Speech or Proceeding by him in Parliament, as a breach of its privileges, in order that the said Judicial Committee may, after hearing argument on both sides (if necessary), advise me thereon: and further praying that I will, upon receiving the advice of the said Judicial Committee, be pleased to communicate such advice to the House of Commons, in order that the House may take such action as seems to it proper in the circumstances.

I shall give directions accordingly.

MONUMENT TO THE EARL OF BALFOUR

The VICE-CHAMBERLAIN OF THE HOUSEHOLD reported Her Majesty's Answer to the Address, as follows:

I have received your Address praying that I will give directions that a Monument be erected within the precincts of the Palace of Westminster at the public charge to the memory of the late Right honourable the Earl of Balfour, K.G., O.M., with an inscription, expressive of the high sense entertained by the House of Commons of the eminent services rendered by him to the country and to the Commonwealth-and-Empire in Parliament, and in great offices of State, and assuring

Me that you will make good the expenses attending the same.

I will gladly give directions for carrying into effect your proposal to do honour to the memory of that illustrious Statesman and devoted servant of his country.

Oral Answers to Questions — EDUCATION

School Meals

Mr. Frank Allaun: asked the Minister of Education what is the fall in the number of children taking school dinners since the latest increase of 2d. per meal, both nationally and for Salford in particular, including the autumn figures.

The Parliamentary Secretary to the Ministry of Education (Sir Edward Boyle): The autumn figures are 9,717 for Salford and 2,815,307 for England and Wales, excluding Nottinghamshire, for which the return is not yet available. These figures show a fall of about 1,050 and about 210,200 on those for 1956.

Mr. Allaun: Does not the Minister think these figures are very serious? Does not he agree that a good meal is as vital to a child's education as a good school teacher, and that this miserable financial economy cannot justify the damage to the health of so many children?

Sir E. Boyle: One has to remember that the fall in numbers is, in part, the result of fewer children being present at school as a result of the 'flu epidemic. [HON. MEMBERS: "Oh."] Certainly there were nearly 1,000 fewer children at school at Salford, and nearly 170,000 fewer in England and Wales, which is a big difference.

Mr. Allaun: Is not the Minister aware that five weeks ago he told me that the delay in introducing the figures was due to the 'flu epidemic, and that clearly the epidemic has gone since the hon. Gentleman has produced the figures?

Sir E. Boyle: The hon. Gentleman asked for the autumn figures, and the 'flu epidemic is relevant to those figures.

Mr. G. Thomas: asked the Minister of Education the number of children taking


school meals in Wales during October in the years 1957, 1956 and 1951, respectively.

Sir E. Boyle: 172,864 this year, 189,450 last year and 187,170 in 1951.

Mr. Thomas: Is the hon. Gentleman aware that the teaching profession, without whom he could not carry on the school meals, are thoroughly fed up with his failure to honour the promises made by the Department right through the year? When will he give teachers a fair deal in connection with the school meals service?

Sir E. Boyle: Do not let us be too gloomy about the school meals service. The meal is still extremely good value at a shilling. At the start of the war, in 1940, one in thirty children were having the meals, whereas it was one in three in 1945, and today is very nearly half.

Mr. Thomas: In view of the fact that the Minister has completely misunderstood me and I should like to have a satisfactory reply, I beg to give notice that I shall raise the matter on the Adjournment.

Sir E. Boyle: I did not mean to be discourteous to the hon. Member. I thought his Question—

Mr. Thomas: My supplementary question—

Sir E. Boyle: —related to the number of children taking school meals.

Institute of Almoners (Grant)

Mr. Brockway: asked the Minister of Education if he will take steps to arrange for a grant to be made to the Institute of Almoners to assist students to undertake training as almoners.

Sir E. Boyle: Assistance to students for this purpose is already available either from local education authorities or under a scheme of bursaries administered by my right hon. Friend the Minister of Health.

Mr. Brockway: I am aware of that, but is the Parliamentary Secretary aware that these grants are made on a means test basis? Could he not follow the example of the Home Office which, in the case of training for child care and probation, does not insist upon these limits?

Sir E. Boyle: I know the hon. Gentleman's concern in this matter. I am aware of the burden on local education authorities of making awards for the training of medical auxiliaries generally. Assistance to this institute is a matter for my right hon. Friend the Minister of Health.

Expenditure

Mr. Brockway: asked the Minister of Education what proposals Her Majesty's Government have for increasing the estimated expenditure on education during the present financial year.

Sir E. Boyle: The Ministry's Vote for the current year is £33 million larger than last year's.

Mr. Brockway: Is not that a very insignificant sum? [HON. MEMBERS: "Oh."] Yes, very insignificant, compared with the absolute importance of developing education in this country not only of a classical character but of a technical kind. How in the world can this country keep its position if we do not spend more upon education than is indicated in the Parliamentary Secretary's Answer?

Sir E. Boyle: I quite agree with the hon. Gentleman about the importance of education. The proportion of the national income devoted to the service has gone up substantially under the present Government.

Mr. Moss: asked the Minister of Education what estimate he has formed of how educational expenditure is likely to vary over the next few years.

Sir E. Boyle: I expect educational expenditure to continue to increase over the next few years.

Mr. Moss: If this is so, is the Minister certain that the proportion that the local education authority will receive from the proposed general grant will be not less than the amount it would receive if the percentage grant continued?

Sir E. Boyle: The expansion which we must expect can be allowed for just as well under the proposed general grant as under the percentage grant but we shall, of course, be debating this matter fully next week.

Mr. M. Stewart: The hon. Gentleman has said that he expects educational expenditure to increase over the next few


years. Can he say also that the amount of the block grant will increase over the next few years?

Sir E. Boyle: I ask the hon. Member to have a careful look at Clause 2 (1) and (4) of the Local Government Bill.

National Association of Schoolmasters (Representation)

Mr. Gresham Cooke: asked the Minister of Education if he will now invite a member of the National Association of Schoolmasters to join the Teachers' Panel of the Burnham Committee so that the Association's views on the question of salaries may be fully presented thereon.

Sir E. Boyle: No, Sir. As my right hon. Friend stated in his reply on 14th November to my hon. Friend the Member for Cardiff, North (Mr. Llewellyn), he sees no reason to dissent from the view taken by his predecessors on this matter.

Mr. Gresham Cooke: Would my hon. Friend not agree that, although there are already six organisations on the Burnham Committee, the National Association of Schoolmasters, the second largest organisation of teachers, is unrepresented on the Committee? Is my hon. Friend aware that the Association has 17,000 members and is the voice of the men at the primary and secondary-modern level? As there are three women on the Committee, ought not the voice of these men be heard?

Sir E. Boyle: I hope my hon. Friend will remember that representation on the Burnham Committee is not determined solely by the size of the organisation concerned. The smaller associations on the Committee represent teachers with a distinct interest in certain types of school with which the Burnham Committee is concerned. There is value in having the Committee constituted according to the pattern of our maintained schools, and in not introducing representatives primarily concerned with the special interests of either men or women teachers.

Primary School Admissions (Circular)

Mr. Moss: asked the Minister of Education to what extent he has considered the effect of Circular 313 upon

infant and other schools; and what is his conclusion.

Sir E. Boyle: The effect has been to improve conditions for the children and to make better use of the available staff.

Mr. Moss: While thanking the Minister for his courtesy in having written to me about the position in the County of Warwick, may I ask if I am to understand that the Warwickshire Education Authority is free to admit children to infants' schools if they reach their fifth birthday in the term, provided there are reception classes? Did the Parliamentary Secretary inform the county education officer of the contents of the letter which the hon. Gentleman sent to me?

Sir E. Boyle: There was certainly nothing private in the letter I sent to the hon. Gentleman. The local education authority has discretion under the circular to treat each school on its merits. The circular does not affect the admission of children in the term in which they will become five. If there are further points, perhaps the hon. Gentleman will correspond with me again.

School Population

Mr. Moss: asked the Minister of Education what is now the proportion of the eligible school population selected for education at grammar schools and at technical schools, respectively; and what proportion of the remainder has the opportunity to take the General Certificate of Education in other schools.

Sir E. Boyle: In January, 1957, 20·3 per cent. of the 13-year old pupils for whom local education authorities were responsible were in grammar schools or the grammar streams of other secondary schools. Five per cent. of the 14-year old pupils were in technical schools or streams. More than a quarter of the remaining pupils were in secondary schools that normally enter candidates for the General Certificate of Education.

Mr. Moss: Has the Parliamentary Secretary seen the advertisement accepted for the 4s. 6d. book of stamps by the Post Office and which reads:
If you have average intelligence, no matter what your previous education you can quickly qualify for success with our help.
Does not that indicate that it is easy for people of average intelligence to get the


General Certificate of Education? Is not the percentage which the Parliamentary Secretary has mentioned lower than the average, and has the hon. Gentleman allowed for the fact that in some areas the percentage is much lower than the average which he has given?

Sir E. Boyle: There are bound to be differences of some degree between one area and another. My right hon. Friend's Department does not prescribe which secondary-modern schools may enter for the General Certificate of Education. I think the hon. Gentleman would agree that as time goes on more and more secondary schools are rapidly becoming first-class, respected educational institutions in their areas.

Training Colleges (Students and Grants)

Mr. Pitman: asked the Minister of Education to what extent he plans to improve the maintenance grants, both in amount and in duration, so that mature applicants may be willing to become students at the three training colleges for technical teachers and the target of 700 per annum recommended by the Dr. Willis Jackson Committee attained.

Sir E. Boyle: My right hon. Friend intends very shortly to put to the local authorities' associations proposals for improving these grants, and also to discuss with the authorities concerned the provision of new accommodation for the three colleges. This should enable them to take 500 students, which was the number recommended as an immediate aim by the Willis Jackson Committee.

Mr. Pitman: I am sure that the House and the nation will be very grateful for that news. Will my hon. Friend bear in mind the need to cover the period between the end of training and the taking of the new post in the autumn? These candidates for teaching find it very expensive to live with no income between those points. I hope that the maintenance grants may cover that period as well as the period of training at college.

Sir E. Boyle: We shall certainly bear my hon. Friend's point in mind.

Mr. Pitman: asked the Minister of Education by how many the students admitted this autumn fell short of the numbers recommended by the Dr. Willis Jackson Committee.

Sir E. Boyle: 360 students were admitted this year to the three training colleges for technical teachers. As my hon. Friend will recall, the Willis Jackson Committee recommended that the number of students should be raised to 500 in the first instance.

Technical Colleges (Sandwich Courses)

Mr. Willey: asked the Minister of Education how many sandwich courses have been started at technical colleges this year; and how many students have been enrolled at these courses.

Sir E. Boyle: Eleven new sandwich courses, with an enrolment of 89 students, were approved and started at the beginning of 1957. Forty-seven more courses were approved to start this autumn, but I do not yet know how many students have enrolled for them.

Mr. Willey: While thanking the Parliamentary Secretary for his reply, may I ask him to do his utmost to encourage and promote more of these sandwich courses, which are absolutely necessary in view of the demands being made on technical manpower?

Sir E. Boyle: I am going up to the North-East this evening and I shall be making a speech about it tomorrow.

Mr. M. Stewart: Will the hon. Gentleman be able to say, after an appropriate period of time, how many of the students satisfactorily completed the course? Will it not be important to know that?

Sir E. Boyle: Yes, I quite agree with the hon. Gentleman.

Mr. Willey: On a point of order. I have had a reply from the Parliamentary Secretary referring to some extra-Parliamentary activity of his, but I have had no invitation to this activity. It is hardly in order to refer me by way of reply to a statement he is going to make in the future when I shall not have the pleasure of hearing it.

Sir E. Boyle: I will see that the hon. Gentleman receives a copy.

Building Programme (Secondary Modern Schools)

Mr. Dye: asked the Minister of education which are the 49 county educational authorities which will be unable to


complete their building programme of secondary modern schools by 1960; and what other date has been fixed for the completion of this important programme.

Sir E. Boyle: With permission, I will circulate the list in the OFFICIAL REPORT cannot say by what date it will be possible to complete the rural reorganisation programme.

Mr. Dye: Does the Parliamentary Secretary remember that the original statement with regard to the completion of this reorganisation programme was made a month or two before the last General Election? Can he say whether another statement will be made a month or two before the next General Election? Do we not want to know from what date this is postponed?

Sir E. Boyle: Under reorganisation schemes 33 schools have been already built and 147 have been already started. That is not too bad. My right hon. Friend agrees that the replacing of these old schools in rural areas is badly needed and certainly greatly regrets that the economic situation has made it necessary to slow down the programme. I cannot say more at the moment, but, naturally, as soon as there is further news I will see that the hon. Member is informed.

Following is the list of authorities:

List of counties not likely to be wholly reorganised for secondary education by1960.

Bedfordshire. Berkshire. Buckinghamshire. Cambridgeshire. Cheshire. Cornwall. Cumberland. Derbyshire. Devon. Dorset. Durham. Essex. Gloucestershire. Hampshire. Herefordshire. Huntingdonshire. Isles of Scilly. Kent. Lancashire. Lines—Holland. Lincs—Kesteven. Lines—Lindsey. Middlesex. Norfolk. Northamptonshire. Northumberland. Nottinghamshire. Oxfordshire. Shropshire. Somerset Staffordshire. Suffolk. East. Suffolk, West. Surrey. Sussex. West. Westmorland. Wiltshire. Worcestershire. Yorks, East Riding. Yorks, North Riding. Yorks. West Riding. London. Breconshire. Caernarvonshire. Carmarthenshire. Denbighshire. Glamorgan. Merionethshire. Pembrokeshire.

Norfolk

Mr. Dye: asked the Minister of Education when he expects to set a date by which all the 2,200 senior children in Norfolk who will be without secondary modern education will be adequately provided for.

Sir E. Boyle: I cannot say at present.

Mr. Dye: Is it not necessary to make a statement on this matter as early as possible so that the local education authority can make its plans accordingly?

Sir E. Boyle: All I can tell the hon. Member is that the figure of 2,200 senior pupils in unreorganised schools will be reduced to 1,900 when Reepham Secondary Modern School, which is to be started next year, is finished. I cannot go into that at the moment because it involves future rebuilding programmes.

New Schools (Rural Areas)

Mr. Dye: asked the Minister of Education the number of new schools he estimates is required to complete the reorganisation of education in rural areas; and what is their estimated cost on present building prices.

Sir E. Boyle: 142, at an estimated cost of about £15 million.

Teachers' Training Colleges

Mr. M. Stewart: asked the Minister of Education what local education authorities have, in the last 12 months, made proposals to him for the establishment of teachers' training colleges; and what reply he has made.

Sir E. Boyle: The only firm proposal was one made in November, 1956, by the West Bromwich Local Education Authority. The authority was told that the Minister could not agree to it.

Mr. Stewart: Could the hon. Gentleman say why that proposal was refused? Is it not the case that if we are to make any educational progress with smaller classes and the raising of the school-leaving age we are bound to need a bigger intake of teachers than we are getting at present?

Sir E. Boyle: I know the concern of the hon. Member in this matter, which we have debated before. At the moment, we do not think that a heavy expenditure now in starting new colleges would be justified. If we want to increase the supply of teachers from training colleges, it would be more economical to expand existing colleges than to establish new ones. If circumstances and policies change and larger plant is needed, we shall look at this again in consultation with the National Advisory Council. I


am glad to say that we are now getting more graduates each year into teaching, which is naturally something of which we must take account.

Block Grants

Mr. Lipton: asked the Minister of Education how many associations representing educational interests have written to him commending the Government's block-grant proposals.

Sir E. Boyle: None, Sir.

Mr. Lipton: Is it not therefore absolutely clear that never before have all the people connected with our educational service been so unanimous and inflexibly opposed to the menace of the proposals of the present Government? Does the hon. Gentleman want his right hon. Friend to be the first Minister of Education who has not a single supporter for his policy in the educational service of this country?

Sir E. Boyle: I am not sure that an austere logician would think the hon. Member's supplementary quite followed from my original Answer, but I think we had better await the debate on this subject next week.

Mr. M. Stewart: Could not the hon. Gentleman arrange for the Association of Conservative Teachers to send him just a word of comfort?

Sir E. Boyle: We have had some very happy discussions on this topic—I certainly have—with the Association of Conservative Teachers and many other bodies, but I do not want to anticipate next week's debate.

Mr. Rippon: Is my hon. Friend aware that many people welcome the proposals of the Government to give greater freedom to democratic local authorities by giving them the opportunity, if they are so minded, to devote more of their resources to education than is at present permitted?

Sir E. Boyle: I am grateful to my hon. Friend. There have been some excellent salvoes fired on each side in the Press and there has been a thoroughly healthy debate so far.

Old Schools (Demolition)

Mr. Slater: asked the Minister of Education how many schools there are in this country which are scheduled for

demolition because of the age of the structure; and if he will set out in the OFFICIAL REPORT the areas so affected, distinguishing State and denominational schools, respectively.

Sir E. Boyle: This information is not available.

Mr. Slater: Is not the hon. Gentleman aware of the desire for more urgent action to be taken to get rid of these substandard buildings in which a great percentage of our young people are having to congregate to receive education? Is he satisfied with the progress being made to rid this country of such places?

Sir E. Boyle: Since the war we have had to concentrate first on beating the bulge and seeing that we do not have children out of school, but I wholly agree with the hon. Member that when that process is completed there will remain the questions of replacing old schools and also of urban reorganisation.

Oral Answers to Questions — TRADE AND COMMERCE

Cinematograph Films (Levy)

Mrs. White: asked the President of the Board of Trade what is his present estimate of the yield of the cinematograph levy based on current attendance figures.

Mr. H. Hynd: asked the President of the Board of Trade how much he estimates will be produced during the next 12 months by the statutory levy now being imposed on cinemas; and whether he proposes to amend the regulations as a result of his recent interview with representatives of cinema proprietors.

The President of the Board of Trade (Sir David Eccles): If attendance figures continue well below last year's there may be some shortfall, but it is too early to revise the estimate of £3¾ million given for the year which began on 20th October, 1957. For the same reasons, it is too early to consider amending the regulations.

Mrs. White: While it may be too early to give any precise reply, will the right hon. Gentleman give an undertaking that if there is a really serious shortfall which becomes apparent during the first six months he will take steps, or at least review the situation, so that producers


for whom the statutory levy is being made will have some idea of where they stand?

Sir D. Eccles: If there is a serious and continuing short-fall, of course we shall look at the situation again.

Mr. H. Hynd: Has the right hon. Gentleman seen the statement by the Association of Independent Cinemas in which it is claimed that they will be about £1 million out of pocket as a result of this? Does he agree with that estimate, or can he give his own estimate?

Sir D. Eccles: Estimates of cinema attendances are very difficult to make. I think we must wait and see what actually happens.

Retail Sales (Weights, Measures and Prices)

Miss Burton: asked the President of the Board of Trade whether he is aware of the difficulty of protecting customers against over-charging unless shopkeepers state the price per lb. of their goods; and if, therefore, he will set up a committee to inquire into the advisability of initiating legislation to compel butchers, poulterers, and fishmongers to sell their goods by weight and declare the price per lb.

The Parliamentary Secretary to the Board of Trade (Mr. F. J. Erroll): The Hodgson Committee on Weights and Measures Legislation made recommendations about sale by weight, but it did not make any recommendations about declaring the price per lb. Its recommendations about the retail sale of fish and poultry by weight are likely to be implemented by regulations after the necessary trade consultations have taken place. Butcher's meat is already required to be sold by weight. My right hon. Friend does not consider that a requirement to state the price per lb. is a suitable subject for legislation.

Miss Burton: Is the Parliamentary Secretary aware that obviously we on this side of the House are in advance of the Hodgson Committee, which is a long way in advance of the Board of Trade? Is his statement that butchers are compelled to state the price per lb. of meat correct, because I am not sure of that? Is he aware that many people in the lower income groups suffer very

much from this form of overcharging of 2d. or 3d. on various fractions of a pound? Could he not look at the matter again?

Mr. Erroll: I can assure the hon. Lady that meat must be weighed in front of the customer, or the weight declared by delivery note or label, whether the meat is pre-packed or not.

Mrs. Mann: asked the President of the Board of Trade how many non-food household commodities are now sold without statutory obligation to state weight, or number of contents per packet, or per box.

Mr. Erroll: All non-food household commodities except coal.

Mrs. Mann: I am told that all are now without an obligation to state the number of contents per packet and so on. In that case, how is it possible accurately to assess the cost of living if these fluctuations are taking place every day?

Mr. Erroll: Questions about the assessment necessary to compile the cost-of-living index should he addressed to my right hon. Friend the Minister of Labour.

Mrs. Mann: asked the President of the Board of Trade if he is aware that since the end of controls fruit, vegetables, meat, fish, sugar and flour confectionery are being sold in self-service stores and super-markets without any declaration of weight; and if he will take steps by Statutory Instrument to protect consumers from short weight in these commodities.

Mr. Erroll: It is an offence to give short weight of any foodstuffs. Meat, sugar and potatoes must be sold by weight, which, except in the case of sugar and potatoes pre-packed by the retailer, must be indicated to the retail purchaser. The Hodgson Committee on Weights and Measures Legislation recommended that fresh fruit, vegetables and fish, but not flour confectionery, should also be sold by weight. This and the Committee's recommendations about marking are being considered in connection with the regulations which my right hon. Friend proposes to make.

Mrs. Mann: How can the hon. Member stand there, tall, bland, urbane and with his tongue in his cheek, and give a


reply which shows that he is not familiar with the recommendations of the Hodgson Committee? It is the second time today he has given this reply. The Hodgson Committee Report revealed the growth of the self-service store and pointed out the dangers. The hon. Member surely knows that all these items which I have mentioned are sold without any necessity to state the weight and that our weights and measures inspectors are puzzled in the extreme to know how they can protect the consumer.

Mr. Erroll: If the hon. Lady studies the answer, which had to be rather long because her Question was rather long, I think she will see not only that I understand the recommendations of the Hodgson Committee but also that we are taking steps to implement some of the recommendations by regulation. If she would like a more elaborate explanation than I can give in answer to a supplementary question, I should be glad to see her at any time to explain matters in more detail.

Overseas Visitors, Wales

Mr. Gower: asked the President of the Board of Trade what was the approximate number of tourists and visitors from overseas who came to Wales last year; how this number compared with the previous year; and what steps he will take, in conjunction with the Welsh Tourist Board, to increase these numbers.

Sir D. Eccles: The British Travel and Holidays Association has estimated that the number of overseas visitors who came to Wales in 1955 was about 100,000. There were 70,000 more visitors from overseas to the United Kingdom last year than in 1955, and I am sure Wales shared in this increase. The Association will continue to meet the cost of the Welsh Tourist Board's overseas publicity on an agreed basis and will also advertise the attractions of Wales in their own publicity programme.

Mr. Gower: Whilst thanking my right hon. Friend for that reply, may I ask if he is aware that the Welsh Tourist Board, out of somewhat inadequate resources, is making great efforts to increase this form of currency earning from abroad? Will he take account of the fact that far too many visitors to this

country limit their visits to London and Stratford-on-Avon and thereby get a most inadequate impression of the British Isles?

Sir D. Eccles: I agree that the Welsh Tourist Board is doing a very good job, and I should like to see visitors from overseas spending a little more time in the United Kingdom. If they could do that by going to Wales they would be well advised.

Motor Cars (Deliveries)

Miss Burton: asked the President of the Board of Trade whether he is aware that many new cars delivered to the docks for the export trade and to distributors for the home trade are damaged mechanically by conditions arising from the car-delivery business, and that the trade would welcome an inquiry; and whether his Department would be prepared to hold one.

Sir D. Eccles: No, Sir. If the hon. Lady has any evidence of damage I should be glad to bring it to the notice of the motor manufacturers and others concerned.

Miss Burton: That is not the question. Is the Minister aware that both the Transport and General Workers' Union and the industry itself are convinced that mechanical damage is done by the overdriving of these cars, and that furthermore it is due to inefficient managements causing too many journeys to be made each day? In view of that, is he not prepared to reconsider the question of an inquiry, which we all feel should have very wide terms of reference and would therefore be better conducted by the Board of Trade?

Sir D. Eccles: No, Sir. I have made inquiries from the Society of Motor Manufacturers and Traders, which says that it has no evidence of any damage. I think it is a matter which the manufacturers and their drivers should settle between them.

East Germany

Mr. Lewis: asked the President of the Board of Trade whether he is aware that West Germany have signed a trade agreement with East Germany for an exchange of goods during 1958–59 of $260 million; that more than $47 million worth


of iron and steel, in addition to $2,400,000 worth of non-ferrous metals are to be supplied to East Germany by West Germany; and whether he will investigate the possibility of Great Britain arriving at a similar trade agreement with East Germany.

Sir D. Eccles: Yes, Sir. But these are unofficial arrangements between neighbours. So far as we are concerned, any trade agreement must be a matter for representative trade organisations, not for the Government.

Mr. Lewis: Whether it is official or not, or whatever the arrangements are, is it not unfair to British manufacturers that East and West Germany are doing an enormous trade, while British manufacturers who want to do import-export business are barred, or at least not helped, by the board of Trade? Will not the right hon. Gentleman take steps at least to put the British manufacturers on the same footing as West German manufacturers?

Sir D. Eccles: The point is that we do not recognise the East German Government.

Mr. Lewis: Nor does Western Germany.

Sir D. Eccles: It is therefore a matter for our manufacturers, if they wish, to make private arrangements. That is how the matter rests at present.

Canadian Trade Mission Talks (Tourists)

Sir I. Fraser: asked the President of the Board of Trade whether, while the Canadian trade delegation is in this country, he will discuss with its members the possibility of developing the tourist traffic so that more Canadian visitors may be received at our holiday and health resorts.

Sir D. Eccles: Yes, Sir; as soon as the Canadian Minister for Trade and Commerce arrived I suggested that we should have such a talk during the last week of the Mission's stay.

Sir I Fraser: Has my right hon. Friend had that talk?

Sir D. Eccles: We have not yet reached the last week of the Mission's stay, but when it comes round, next week, we shall have that talk.

Bankruptcies

Mr. Lewis: asked the President of the Board of Trade if he is aware that, since 1951, there has been an increase of approximately 200 to 400 bankruptcies in each year; what is the reason for these continued increases; and what action he proposes to take to reduce bankruptcies to their pre-1951 level.

Sir D. Eccles: There has been no such regular increase. In fact, since 1953, the annual totals show a small decrease as compared with each preceding year.

Mr. Lewis: Will the Minister look again at the figures? The figures which he gave me previously show an increase of between 200 and 400 in the years which I have quoted. If those figures from him are correct, as I assume they are, will he explain the reason for this increase?

Sir D. Eccles: I suspect that the hon. Member has failed to see that the figures referred to receiving orders and not bankruptcies.

Middle East

Mr. Emrys Hughes: asked the President of the Board of Trade to what extent British exports to Egypt and the countries of the Middle East have increased since 1955.

Sir D. Eccles: Total exports (including re-exports) to Egypt have declined from £29 million in 1955 to £1·3 million in the first ten months of this year, but total exports to the countries of the Middle East excluding Egypt have risen from £131 million in the full year, 1955 to £152·1 million in the first ten months of 1957.

Mr. Hughes: Could the Minister say what steps are being taken to increase our trade with Egypt?

Sir D. Eccles: That is another Question.

Oral Answers to Questions — NATIONAL FINANCE

Bagdad Pact Region (Free Trade Area)

Mr. Brockway: asked the Chancellor of the Exchequer what conclusions have been reached by the Working Party which is considering the advisability of establishing a Customs Union, Common Market


and Free Trade Area in the Bagdad Pact region.

The Financial Secretary to the Treasury (Mr. J. Enoch Powell): The Working Party recommended that for the present the study of a Customs Union or Common Market should not be proceeded with, but that the possibility of a Free Trade Area should be examined.

Mr. Brockway: May I ask the hon. Member whether his Department, in association with other Departments of the Government, will take great care before proceeding with this scheme and will take into consideration the danger of making a further division of the nations in the Middle East, which may be very serious for the cause of peace?

Mr. Powell: This Report has to be considered by the Economic Committee of the Bagdad Pact early next year. Pending that, I think it would be wise to make no comment.

Sales Tax

Sir R. Boothby: asked the Chancellor of the Exchequer whether he will give consideration to the possibility of replacing the present system of varying Purchase Taxes by a general sales tax.

Mr. Powell: I cannot add to my right hon. Friend's reply on this subject to the right hon. Gentleman the Member for Battersea, North (Mr. Jay) on 12th November.

Sir R. Boothby: Does not my hon. Friend think that it is rather a good idea?

Gold and Dollar Reserves

Mr. Cronin: asked the Chancellor of the Exchequer what proportion of the increase in the gold and dollar reserves since he raised the Bank Rate to 7 per cent. in September has been brought about by the influx into the United Kingdom of short-term capital funds from abroad.

Mr. Powell: On the best judgment that can be made, and apart from the drawing on the Export Import Bank, the increase has arisen mainly from commercial requirements for sterling.

Mr. Cronin: Does not the hon. Member appreciate that, now that speculation against sterling has largely ceased, any further improvement in the gold reserves

brought about by the 7 per cent. Bank Rate will be by the inflow by short-term funds—that is, hot money—which will flow out as soon as the Bank Rate is lowered? Is a 7 per cent. Bank Rate therefore worth it?

Mr. Powell: I told the hon. Member that the best evidence that I have is that this increase has been due to commercial requirements.

Mr. Cronin: Does not the hon. Member mean by "commercial requirements" short-term funds flowing into the country?

Purchase Tax

Mr. Cronin: asked the Chancellor of the Exchequer if he will arrange for the Board of Customs and Excise to collect Purchase Tax monthly from wholesalers instead of quarterly as at present.

Mr. Powell: No, Sir. Monthly collection would be unduly burdensome to wholesalers and would greatly increase the cost of collection.

Mr. Cronin: Does the hon. Gentleman not appreciate that at present wholesalers of taxable commodities are holding very large sums of public money while these are awaiting collection? Has not the time at least arrived for a stop to be put to irregular perquisites, such as interest on public money?

Mr. Powell: No, Sir. In general, the credit which the wholesalers have in respect of tax is no longer than the credit which they give to their customers in respect of the tax which they have to recover from them.

Sir I. Fraser: asked the Chancellor of the Exchequer if, in his Budget next year, he will consider the claim of the owners and operators of hotels and boarding houses that the manufactured goods of all kinds used in their establishments are the tools of their trade and relieve them of Purchase Tax, subject to proper safeguards.

Mr. Powell: I cannot anticipate my right hon. Friend's Budget statement.

Sir I. Fraser: Will my hon. Friend observe that I did not ask him to anticipate but merely to consider? Will he do that?

Mr. Powell: Yes, my right hon. Friend will consider all relevant matters in arriving at his Budget decisions.

Wages and Salaries

Mr. Collins: asked the Chancellor of the Exchequer if he is aware that, since 1948, the percentage share of the national income per worker accruing to industrial workers has fallen by nearly 10 per cent. whilst, over the same period, the share of salary earners, directly comparable to wage earners, including managers, shows a substantial percentage increase; and if, in view of the importance of increased production, he will lay stress on this fact in all official discussions with outside bodies which bear upon the relationship between wages and productivity.

Mr. Powell: No, Sir; in manufacturing industry between 1948 and 1956 wages per head increased much more than salaries per head.

Mr. Collins: Is the hon. Member aware that the figures quoted and many of the words used in the Question were used by his right hon. Friend in reply to me two weeks ago, and, therefore, any inaccuracies are his and not mine? in any case, will he say whether he accepts and will try to implement the policy that when wage earners increase productivity they are entitled to share both actually and relatively in the increase in national wealth?

Mr. Powell: The hon. Member is mistaken in his recollection. The allegation was in the hon. Member's supplementary question and not in my right hon. Friend's reply. The figures show that the wage earners have shared in the increased production over those years.

Oral Answers to Questions — TACTICAL ATOMIC WEAPONS

Mr. Zilliacus: asked the Prime Minister (1) whether he will give an assurance that he will, at the North Atlantic Treaty Organisation Conference on 15th December, oppose the use by North Atlantic Treaty Organisation forces of so-called tactical atomic weapons and insist that the use in any situation of atomic weapons of any description must he subject to prior Government approval in the same way as the use of the hydrogen bomb;

(2) why the Government have assented to the North Atlantic Treaty Organisation's forces being armed with tactical atomic weapons to be used on the immediate decision of their commanders in the same way as conventional arms; and what is the Government's definition, in terms of power, of a tactical atomic weapon that may be so used, as distinct from a strategic nuclear weapon that may be used only with the express approval of the Government.

The Prime Minister (Mr. Harold Macmillan): I would refer the hon. Member to the reply given by my right hon. and learned Friend the Foreign Secretary yesterday about responsibility for the use of tactical atomic weapons by North Atlantic Treaty Organisation forces.

Mr. Zilliacus: May I draw the Prime Minister's attention to the fact that the Questions asked for two things: first, an assurance that the Government will not commit the country to the use of tactical atomic weapons by N.A.T.O., of which we are a member, without bringing the matter before Parliament or consulting the electorate, and, secondly, what is the definition in N.A.T.O., with the assent of our Government, of a tactical atomic weapon?
Is it not a fact that the N.A.T.O. generals have declared that a tactical atomic weapon is any nuclear weapon up to two and a half times the power of the Hiroshima bomb and that such weapons, according to the N.A.T.O. generals, may be used on their own immediate decision by commanders in the field?

The Prime Minister: My right hon. and learned Friend tried his best to answer those questions, and I thought his answers were very clear. I thought the Questions themselves a little difficult to understand. In a sense, the first Question is contradictory. It wishes me to oppose any suggestion of our having tactical atomic weapons at all and at the same time to make conditions about their use. I can only repeat the fact as stated by the Foreign Secretary, that the North Atlantic Treaty Organisation commanders have no authority to order the use of tactical atomic weapons on their own immediate decision.

Mr. Emrys Hughes: asked the Prime Minister what consultations he proposes


to have with Dr. Adenauer on the question of the use of atomic tactical weapons by the North Atlantic Treaty Organisation powers on German territory.

The Prime Minister: As the hon. Member is aware, Dr. Adenauer was unfortunately unable to visit this country owing to ill health. These conversations are only just finishing. A communiqué will be issued.

Mr. Hughes: Is the Prime Minister aware that we all regret the illness of Dr. Adenauer? Is he also aware that a very large number of people in Germany are horrified at the thought that these deadly atomic weapons are to be used on German territory again?

The Prime Minister: That is not a matter for me. That is a matter for the Chancellor of the West German Republic.

Oral Answers to Questions — NUCLEAR STOCK PILES

Mr. Rankin: asked the Prime Minister what agreement has been reached with the United States of America regarding the setting up of nuclear stock piles by the United States in this country; and under whose control they will be.

The Prime Minister: Stocks of nuclear weapons are held in this country for the bomber aircraft of the United States Air Force that are based here. The use of the bases and aircraft is governed by the understanding reached in 1948 and reaffirmed in 1952.

Mr. Rankin: Does not the Prime Minister realise that this more or less complete alignment with the United States weakens the influence of this country as a moderating factor in easing the tension between Russia and the United States? Will he not think over this matter again to see if he cannot find some better solution?

The Prime Minister: The close co-operation between this country and the United States in this matter was initiated by the Government of which Lord Attlee was head and was followed by the Government on which my right hon. Friend the Member for Woodford (Sir W. Churchill) was head, and I think that those are two very good examples for me to follow.

Oral Answers to Questions — SECRETARY OF STATE FOR FOREIGN AFFAIRS (SPEECH)

Mr. Emrys Hughes: asked the Prime Minister whether the statement on British foreign policy in relation to the Union of Soviet Socialist Republics contained in the broadcast speech delivered by the Secretary of State for Foreign Affairs on 30th November represents the policy of Her Majesty's Government.

The Prime Minister: Yes, Sir.

Mr. Hughes: Does the Prime Minister really listen to the Foreign Secretary's broadcasts, or does he switch off before the right hon. and learned Gentleman finishes? Is the Prime Minister aware that his chief Conservative supporter in Scotland, The Scotsman, said of the Foreign Secretary:
… it is hard to say what he is thinking about,
and that his platitudes were repellent; also that it contrasted his broadcast very unfavourably with that of Mr. George Kennan who followed the next night?

The Prime Minister: The Question asked whether the broadcast made by my right hon. and learned Friend represented the policy of Her Majesty's Government. The answer is "Yes". I thought that it stated that with great clarity, with great force and with great wisdom.

Mr. Zilliacus: asked the Prime Minister whether the broadcast on 30th November by the Secretary of State for Foreign Affairs, in which he insisted that the Soviet Union must agree to a reunited Germany entering the North Atlantic Treaty Organisation before there could be an end to the nuclear arms race and a European settlement, and referred to this country's victories over Phillip II of Spain. Napoleon and Hitler as historic precedents for Britain's dealings with the Soviet Union today, represented the Government's policy.

The Prime Minister: My right hon. and learned Friend made no such statement about Germany. He reaffirmed that a solution to the problem of German reunification was one of the issues over which a positive move by the Soviet Union was desirable. My right hon. and learned Friend's valid historical references were in order to indicate that it is never wise to regard Great Britain as a spent force.

Mr. Zilliacus: Does the first part of the Prime Minister's reply mean that the Government are prepared to consider solutions alternative to that of the Soviet Government allowing a united Germany to enter N.A.T.O. and, if so, what alternative solution? Is not the Prime Minister aware, on the second half of the Question, that great alarm and apprehension was conveyed by the apparent historic parallel to the effect that the Government were seriously thinking of singeing the beard of the King of Spain with hydrogen bombs in the Kremlin?

The Prime Minister: The hon. Member asked the Question in two parts, and I have answered both of them. He has now merely restated the Question.

Oral Answers to Questions — ELECTRICAL TRADES UNION

Mr. Farey-Jones: asked the Prime Minister if he will move for the appointment of a tribunal under the Tribunals of Inquiry (Evidence) Act, 1921, to inquire into the recent conduct of the affairs of the Electrical Trades Union.

The Prime Minister: I have seen reports of some recent elections in this union which are bound to cause public concern. Nevertheless, I do not think that on the facts before me the appointment of a tribunal under the Tribunals of Inquiry (Evidence) Act, 1921, would be appropriate.

Mr. Farey-Jones: Is my right hon. Friend aware of the grave and deep anxiety expressed from every part of the country and every section of the community? Is he also aware that there are millions of proud citizens in this country who do not necessarily seek to interfere with the affairs of the trade unions but who will not tolerate Communist domination in any of our traditional institutions?

The Prime Minister: Yes, Sir, but on the particular form of dealing with this problem, after much thought I think that the reply I have given is the right one. I believe that this is a problem which is taken very seriously in all parts of the country and in all parts of the House. It is intolerable that great unions should become dominated by Communist leaders, especially as we believe it—as, I think, they do themselves—to be against the wishes of the members of the union.

But there are appropriate methods which should be given a full chance to operate before more drastic action can be considered.

Mr. Lee: Is the right hon. Gentleman aware that no matter how undesirable we may feel the appointment of Communist officials to be, when all is said and done it is a matter for the members of the union concerned? Is he further aware that we do not believe that the machinery of the 1921 Act, or, indeed, legislation of any type, can be appropriate to this type of case, that the Trades Union Congress already has the necessary powers—[HON. MEMBERS: "Why not use them?"]—to make investigations on its own, and that in any event all trade union rules must be submitted to the Registrar-General?

The Prime Minister: What the hon. Member has said merely shows that this is a matter which it is primarily the duty of the members of the union to cure, but for which other bodies have a responsibility which, I feel sure, they will not shirk.

Mr. Mawby: While agreeing with my right hon. Friend, does he agree with me that a point is reached where members have their powers so reduced that they are completely impotent? Will he further agree that, as the only member of this union in the House, I have every right to ask a supplementary question? As I am the only member of the union in the House, may I ask whether my right hon. Friend does not agree that there is danger in the fact that I may be the only member of that union not likely to risk his livelihood by indulging in just criticism? Therefore, would it not be a good thing for the T.U.C. to use its good offices to investigate this matter to make certain that members of that trade union can a least be assured that they have an opportunity to express themselves in a proper manner?

The Prime Minister: Yes, Sir. I think that the whole House has much sympathy with the view put forward by my hon. Friend. A great responsibility lies upon the men of the union to do their best to eradicate anything wrong or improperly done. It is up to organised labour in the first instance, at any rate, to take the necessary steps.

Mr. J. Griffiths: Is not the right hon. Gentleman aware that if, as the hon. Member for Totnes (Mr. Mawby) alleges, the rights of the members of this union are being reduced or in any way curtailed, those rights being enshrined in the rules of the union which have to be submitted to and approved by the Registrar-General, he has the duty and responsibility to report the matter not only to the House but to the Registrar-General? Is not that the advice which should be given to members of this union if the rules are being broken?

The Prime Minister: Yes, Sir. That is the formal and legal position, but no doubt the right hon. Gentleman himself is somewhat disturbed about what has been revealed. I believe that he and his friends can be most useful in getting the trade union movement in general to try to put right anything that is wrong.

Mr. Griffiths: Is the Prime Minister aware that we are concerned about the trade union movement but, from our experience, we believe that these matters are better dealt with by the trade unions themselves?

The Prime Minister: Yes, Sir. That is true, if they are dealt with.

Mr. Shinwell: When the right hon. Gentleman referred to public concern about this matter, was that statement based on newspaper reports or because he had previously sought to make investigations into this matter and ascertain all the facts? Is it not a little unwise and premature to pronounce on a matter of this sort before ascertaining all the facts and even attempting to find out what the union officials have to say?

The Prime Minister: I do not think that when I said that this matter caused concern I was going beyond what would, I know, be the views of very responsible leaders of the trade union movement.

Oral Answers to Questions — AIRCRAFT (NUCLEAR BOMBS)

Mr. A. Henderson: asked the Prime Minister whether, in view of the danger of radioactive fall-out from crashed aircraft carrying hydrogen bombs, he will take steps to ensure that bombers of the Royal Air Force and the United States Air Force engaged in training flights, as

distinct from operational flights in times of emergency, in the United Kingdom do not carry nuclear bombs.

Mr. Frank Allaun: asked the Prime Minister what is his estimate of the risk of escape of dangerous radioactive material, without nuclear explosion, in the event of fire following the crashing of an aircraft carrying a nuclear bomb.

The Prime Minister: I explained on Tuesday that there is no danger of the hydrogen bomb exploding in the event of a crash of the aeroplane. In the event of a crash there would be a danger, but of a very limited kind. The risks are certainly not sufficient to justify any action which would seriously reduce the state of readiness of bomber aircraft.
It is on taking off and landing that aircraft accidents most commonly occur. All the special safety precautions which have been devised are available on the spot at these times. A crash elsewhere than at the base is a possible but an improbable contingency.

Mr. Henderson: May I ask the Prime Minister, first, whether his attention has been drawn to a report in the Daily Telegraph recently to the effect that, in addition to the danger from oxidisation, there is a serious danger from alpha-rays, and, secondly, whether it is not a fact that, apart from special exercises, most bombers when taking off do not have their bomb racks loaded with nuclear bombs? Would he not seek to allay public anxiety by confirming that statement?

The Prime Minister: With regard to the first part of the supplementary question, the technical information which I gave is the best that I have been able to obtain, and I sincerely believe that the degree of danger is very limited indeed. I should like to thank the right hon. Gentleman, who has great experience of these matters, for the second part of his supplementary question. It is not to be supposed that all the time there are bombers loaded with nuclear bombs, whether of our own Air Force or of the American Air Force, flying over these islands. These are occasional training flights and patrol flights, and by far the greater part of them are probably taken out to sea.

Mr. Allaun: Can the right hon. Gentleman explain in this connection his very curious statement that special tankers are available to refuel a hydrogen bomber in the air so that it can return to America if unable to land in Britain? Why should it be unable to land in Britain?

The Prime Minister: If the hon. Gentleman had come to this House by any normal method of approach, I think that he could have found the answer to that.

Mr. Grimond: asked the Prime Minister to what extent the agreement that nuclear weapons should not be used by United States aeroplanes based on this country without prior consent by Her Majesty's Government applies also to such weapons carried by aeroplanes on patrol over this country or over near-shore waters but not based on this country.

The Prime Minister: The understanding reached by Mr. Attlee and confirmed by my right hon. Friend the Member for Woodford (Sir W. Churchill) refers to bases in this country and aeroplanes stationed upon them. United States aeroplanes based on other bases do not normally fly over Britain or British territorial waters.

Mr. Grimond: Does this not lead to the rather odd situation in which, apparently, who takes the decision about dropping the bomb depends on which aerodrome the plane has come from? I appreciate that it is difficult to deal with this in question and answer for security reasons and so forth, but has the Prime Minister considered what was said yesterday about the possibility of producing a White Paper to clear up this anomaly? Otherwise, this is extremely disturbing.

The Prime Minister: I do not know why it should be more disturbing. The fact that they are based in this country gives us a say which we should not have in the case of machines based in any country under their own control. I will go further and say that the principle that underlay this agreement of close co-operation, not only of Britain and the United States but of all the allies in the N.A.T.O. countries, makes it clear that some decision of this kind would not be taken rashly or foolishly or except upon general consultation with those concerned. I will look again at the possibility of trying to

draw up perhaps a more full account. I have tried to give as full an account as I can in reply to Questions and supplementary questions, and I will see whether now, or perhaps more usefully after the N.A.T.O. meeting, a complete picture can be given.

Mr. Swingler: asked the Prime Minister if he will give an assurance that Her Majesty's Government will not consent to the use of thermo-nuclear weapons by British aircraft or aircraft based on British soil without the prior approval of Parliament.

The Prime Minister: No, Sir. I would refer the hon. Gentleman to the replies which I gave on Tuesday.

Mr. Swingler: Cannot the right hon. Gentleman reconsider this? I am asking the Prime Minister what power, if any, is left to Parliament to exercise control over events or control over the armed forces in this field. Should it not be for Parliament to discuss and decide whether, for example, a plane on patrol should carry thermo-nuclear weapons, and is it not a matter for Parliament to decide the conditions under which catastrophic consequences may take place from a decision over which we have no influence?

The Prime Minister: That is not the question on the Order Paper. I think that we must try to look at this in the balanced way. If the deterrent is to fulfil its purpose, it is to prevent the horrors of war coming; it is to deter; but if it is bound up with so many difficult problems before it can ever actually become a deterrent, then it loses that power. We have to try to hold the balance reasonably between too loose a control and too tight a control so that there shall be a deterrent and these terrible things will never happen to the world.

Mr. J. Griffiths: Will the right hon. Gentleman, in conjunction with the Foreign Secretary, give full consideration to the suggestion made yesterday in which the Foreign Secretary promised to consider that we should have very shortly a White Paper or a full statement setting out the agreement and the circumstances in which hydrogen bombs are carried from this country, particularly on patrol flights? Will he give serious consideration to this, which, I think, met with the


approval of most hon. Members of this House?

The Prime Minister: I did answer that question at some length in reply to another Question.

Oral Answers to Questions — BALLISTIC MISSILES (LAUNCHING SITES)

Mr. Warbey: asked the Prime Minister whether he will give an assurance that, at the forthcoming North Atlantic Treaty Organisation meeting in Paris, he will not agree to provide launching sites in Great Britain for intermediate-range ballistic missiles.

The Prime Minister: No, Sir. I have no doubt that these, and other similar questions, will be discussed at the conference.

Mr. Warbey: Can the Prime Minister deny that the United States are seeking permission to establish intermediate rocket sites with their appropriate weapons in this country because they will not have, for three or four years, any direct means of reply to the Soviet intercontinental missiles, and will he say whether the Government are prepared to sacrifice the whole of the population of this country in order to protect the United States?

The Prime Minister: I do not know whether the hon. Gentleman attended the defence debates we had this year, but after the discussion in Bermuda it was agreed that these weapons should be supplied and sites provided in this country. Negotiations are in progress for finishing this agreement. We will provide sites, and afterwards the weapons will be transferred to the R.A.F. after a due course of training.

Mr. F. M. Bennett: Is my right hon. Friend aware that, unlike the hon. Gentleman opposite who asked this Question, most of us are more concerned about the weapons in the hands of our enemies than those in the hands of our allies and friends?

RAILWAY ACCIDENT, LEWISHAM

Mr. MacDermot: (by Private Notice) asked the Minister of Transport and Civil Aviation whether he has any statement to make concerning the rail crash last night at Lewisham.

The Minister of Transport and Civil Aviation (Mr. Harold Watkinson): Yes, Sir. At about 6.20 p.m. last night at the country end of St. Johns Station on the South-Eastern down main line, the 4.56 p.m. 11-coach steam passenger train from Cannon Street to Ramsgate collided heavily with the rear of the 5.18 p.m. 10-coach electric passenger train from Charing Cross to Hayes, which was standing at a signal with the brakes on. Both trains were running late because of fog, and they were crowded with passengers.
The collision occurred underneath the bridge which carries the railway from Nunhead to Lewisham over the main line. The leading coach of the steam train left the line of the track and knocked away a supporting column, dropping two of the steel girders of the bridge on to the first two coaches of the steam train, which was still moving.
The engine of the steam train was not derailed and there was not much damage to the rear coach of the electric train, but the two coaches ahead of it were telescoped together and the body of one of them was swept away. The three leading coaches of the steam train were practically demolished by the fallen bridge. An electric train which was moving slowly on to the bridge was stopped by its driver when he saw the trouble below, and it was neither derailed nor damaged.
I deeply regret to say that the casualty roll in the crowded trains was very heavy. So far as it is known at present, 76 people have been killed, including the guard of the electric train, and 193 injured, I am sorry to say, 116 of them seriously.
I have appointed the Chief Inspecting Officer of Railways to hold an inquiry into this accident, and I visited the site with him this morning. I am sure that the House will understand that I cannot make any further statement on this matter at present.
I should like to take this opportunity of paying a tribute to the outstanding work done not only by the emergency services and the voluntary organisations, but also by those living near the scene who so unselfishly put their houses and their belongings at the disposal of the rescuers. [HON. MEMBERS: "Hear, hear."] The conditions in the dense fog and darkness were appallingly difficult and distressing, and there can be nothing but praise for all concerned who worked with such efficiency and determination throughout.
The House will, I know, wish to express its deep sympathy with the relatives and friends of those who lost their lives in this accident and with those who were injured.
Sir Brian Robertson has also asked me to express his sympathy and that of the British Transport Commission, and to say that the Commission will accept full legal liability for compensation in connection with the accident and that all such claims will receive full and early consideration.

Mr. MacDermot: I am sure that I speak for all my right hon. and hon. Friends in saying that we would wish to be associated with the expression of sympathy for the relatives of the bereaved and injured in this terrible disaster. [HON. MEMBERS: "Hear, hear."] Equally, we would wish to be associated with the tributes paid to the heroism and devotion of the rescue workers and all those who live nearby who helped so tremendously. I know that the place where this accident occurred was, in fact, one of the poorer quarters of Lewisham, and there was, no doubt, great sacrifice on the part of many of the local inhabitants. Will the Minister give an assurance that the inquiry which is to be held will be a public inquiry?

Mr. Watkinson: Oh, yes, certainly.

Mr. G. R. Strauss: Obviously, one cannot address questions about the general causes of this accident, but it was suggested quite definitely in one of the newspapers this morning that the fog alarm system was not in operation in this area when it should have been. In view of the fact that the fog conditions may continue, will the right hon. Gentleman consider making a statement, or will he ask the British Transport Commission to issue a statement, quite shortly on that

aspect of the problem so as to reassure the public who travel in foggy weather?

Mr. Watkinson: That is entirely a matter which is absolutely relevant to the inquiry. The inquiry, I hope, will be held soon. It will certainly be held as quickly as humanly possible, and that is exactly the kind of consideration that my Chief Inspecting Officer will have to investigate.

Mr. Strauss: The Minister has not quite appreciated my point, which is that it is desirable for those who are travelling now and during the next few days to have some assurance—which I am sure will be forthcoming, but I think I should ask that it should be given—that the fog alarm system, or whatever it is called, is properly in operation in all areas where there is dense fog.

Mr. Watkinson: Perhaps I did misunderstand the right hon. Gentleman. The specific instance of this accident must, of course, be left entirely to the inquiry. I did discuss the point which the right hon. Gentleman has raised, with Sir Brian Robertson this morning, and he assured me that all the proper drill and arrangements for fog services will be properly carried out.

Mr. Deedes: Speaking for some of those who had a very large number of constituents in the train involved in the crash, may we be associated with the Minister's expression of gratitude to the heroism of the rescue workers?

Mr. H. Morrison: As one who has lost quite a number of constituents as well as having others injured, as have some other hon. Members, I should like to join with the Minister, as well as with my hon. Friend the Member for Lewisham, North (Mr. MacDermot) and the hon. Member for Ashford (Mr. Deedes), in expressing sympathy to the relative's of the bereaved and injured, and admiration of the initiative and pluck of the people who came forward in a spirit of public service to help in the situation.
I presume that the report of the inquiry will be published in as adequate a form as possible in due course, together with any recommendations that may be made.
There is one other point; whether it bears on the matter raised by my right hon. Friend the Member for Vauxhall (Mr. G. R. Strauss) I do not know. It


has been reported by a constituent to my office in the constituency that there was a notice at Charing Cross at about the relevant time saying, "Fog service suspended", it being understood by my constituent that that meant that things were better and that normal service would be resumed. I do not know whether this is accurate or not, nor whether the notice may possibly have been misread, but I would like the Minister's assurance that that point, among others, will be considered, to see whether there is anything in it.

Mr. Watkinson: Yes, Sir. I will certainly see that that is drawn to the attention of my Chief Inspecting Officer. As I think the House knows, there is not only a public and searching inquiry by my Chief Inspecting Officer, but that is preceded by a full technical inquiry by the railways themselves, so this matter will undoubtedly be searched to the bottom.

BUSINESS OF THE HOUSE

Mr. J. Griffiths: May I ask the Leader of the House whether he will state the business for next week?

The Secretary of State for the Home Department and Lord Privy Seal (Mr. R. A. Butler): Yes, Sir. The business for next week will be as follows:

MONDAY, 9TH DECEMBER, and TUESDAY, 10TH DECEMBER—Second Reading of the Local Government Bill.

Committee stage of the necessary Money Resolution.

At the end of business on Tuesday, we propose to take the Committee stage of the Money Resolution relating to Land Drainage (Scotland).

WEDNESDAY, 11TH DECEMBER—Second Reading of the Park Lane Improvement Bill.

Committee stage of the necessary Money Resolution, which it is hoped to obtain by about 7 o'clock;

Committee and remaining stages of the Milford Haven Conservancy Bill.

Report and Third Reading of the Trustee Savings Banks Bill.

THURSDAY, 12TH DECEMBER—Second Reading of the Defence Contracts Bill.

Committee stage of the necessary Money Resolution, which it is hoped to obtain by about 6 o'clock;

Second Reading of the Maintenance Orders Bill.

Consideration of the Motion to approve the Draft Lace Industry (Scientific Research Levy) (Amendment No. 2) Order.

FRIDAY, 13TH DECEMBER—Consideration of Private Members' Motions.

Mr. Griffiths: Will the right hon. Gentleman consider withdrawing the Second Reading of the Defence Contracts Bill on Thursday, because we believe that the Maintenance Orders Bill will, perhaps, require a full day's discussion in the House? Further, can he now make a statement as to when we may expect time to be provided for a debate on foreign affairs?

Mr. Butler: I am not sure that the Defence Contracts Bill need take a very long time; but we ourselves will certainly have a discussion as to what to do about it. We should like to try to obtain if it we can.
As regards a debate on foreign affairs, it would be the Government's wish, if we can manage it, to fit one in in the last week before we adjourn. I cannot give an exact date. That also might be arranged not only with the Opposition, but with other hon. Members who have raised the matter previously.

Mr. Griffiths: I take it that the debate will be arranged? I think that that is the general desire of hon. Members. Will the right hon. Gentleman consult with the Prime Minister and the Foreign Secretary and arrange that a White Paper shall be published dealing with the circumstances of agreements regarding the use of nuclear weapons on patrol or otherwise? This is certainly one of the subjects that ought to be raised in the foreign affairs debate, and it would be for the convenience of the House if we had a White Paper before that debate took place.

Mr. Butler: Yes, Sir. It may well be for the convenience of the House, but I have checked with my right hon. Friends to whom the right hon. Gentleman refers, and no actual undertaking


was given by my right hon. and learned Friend the Foreign Secretary. If we can, we will; but there was no absolute undertaking. I will take note of the right hon. Gentleman's statement.

Mr. Griffiths: I agree that there is no absolute undertaking, but the right hon. and learned Gentleman did promise to consider it, and there was general approval for that promise to consider it. I hope that the right hon. Gentleman the Leader of the House will take it up with his right hon. and learned Friend in that spirit.

Mr. Beswick: Has the attention of the Leader of the House been drawn to the Motion on the Order Paper, signed by over 120 right hon. and hon. Members of the House, asking for early Government initiative in the establishment of the United Nations Force, individually recruited, as a permanent force? Can he say whether he proposes to give any time to discuss it?

[That this House, noting the withdrawal of the Indonesian contingent from the United Nations Emergency Force and the announcement that the Finnish contingent has also decided to withdraw, calls on Her Majesty's Government to support the creation of an individually recruited and permanent force of 20,000 men, operating under the control and direction of a specially constituted council set up by the United Nations, the prime task of such a force being to take up a position between opposing national armies and to garrison areas of potential conflict]

Mr. Butler: I have a copy of the Motion here. I should have thought that one opportunity for debating this would be in the debate on foreign affairs. In any case, I do not think that it would be a subject which would be kept out of such a debate. That is as far as I can go at the moment.

Mr. Harold Davies: Will the debate on foreign affairs be kept narrow in relation to our obligations or agreements within N.A.T.O. so that we can ascertain exactly what is the Government's policy? Further, can the House be assured that a Minister will be able to attend, because, during that week, the N.A.T.O. conference will be proceeding? The House should have a senior responsible Minister

on the Front Bench when the debate takes place.

Mr. Butler: Our idea was to try to arrange the debate in the last week, with the idea, also, that the responsible Ministers could be present. The reason I have not named a date is that it rather depends upon the progress of the discussions at N.A.T.O. I think that it would be wrong to fix a time absolutely until we see when the Ministers can be present. We want to try to arrange a time which suits the convenience of the House and enables the Ministers to be present.
I do not think that the House would wish the debate to be limited, although, of course, coming in the same week as N.A.T.O., it would, naturally, concentrate to a large extent on that subject.

Mr. Braine: Will my right hon. Friend reject completely out of hand the suggestion made by the hon. Member for Leek (Mr. Harold Davies)? Many of us here, on both sides, are acutely worried about the economic implications of the declaration of interdependence of the Western allies, and we should like, in the general context of a debate on foreign affairs and the future of the Western Alliance, to consider economic arrangements and their effect upon trade.

Mr. Butler: Certainly, provided that the debate is described as a foreign affairs debate, and not purely an economic debate, I am sure that we should welcome any interventions by any hon. Members which bring out their anxieties, because the more their anxieties are brought out the more are Her Majesty's Ministers able to dispel them.

Mr. S. Silverman: Is the House to infer from the answer given by the Leader of the House to my hon. Friend the Member for Leek (Mr. Harold Davies) that what is planned is a foreign affairs debate after the conclusion of the N.A.T.O. discussions? Is that what the right hon. Gentleman has in mind? If so, would it not be very much better if, even at this late stage, an effort could be made to have a Parliamentary debate before the country has been committed to agreements which it would then have an opportunity of no more than commenting on?

Mr. Butler: In the circumstances, I think that it would really be better if the debate took place after the discussions


at N.A.T.O. The hon. Gentleman has perceived that it is unlikely to take place before, and I can give no undertaking that we could alter the business to make it possible to have the debate before. We have discussed this matter with the Opposition, and I think that it is very difficult to find a mutually convenient date before; and it is for that reason that we have been obliged to have the debate in the next week when Ministers return.

Mr. Rankin: May I draw the attention of the Leader of the House to the appearance of two very important Motions on the Order Paper today dealing with the desirability of marking the bi-centenary of the birth of Robert Burns, the world's poet, by the issue of special commemorative postage stamps?

[That this House is of the opinion that the bi-centenary in 1959 of the birth of Robert Burns, the National Bard of Scotland, should be marked by the issue of a commemorative postage stamp.]

[That this House, desiring to commemorate on 25th January, 1959, the bi-centenary of the birth of Robert Burns, urges the Postmaster-General to authorise a special issue of postage stamps for that occasion.]

Will the right hon. Gentleman note that those Motions have the support of both sides of the House and that they also have the support of English, Welsh and Scottish Members, betokening, therefore, a general desire on the part of the House to note this important occasion? Will he consider, in the New Year, trying to provide a day so that we might have a friendly discussion with the Postmaster-General on this matter?

Mr. Butler: It so happens, by good fortune, that the Bill we are about to discuss, the Post Office and Telegraph (Money) Bill, might give "Rabbie" Burns an opportunity of enlivening and poetising our debates on this occasion.

I think that that would be to the general advantage of the House.

Mr. Griffiths: May I ask the Leader of the House whether, for the convenience of hon. Members, he will state what are the dates of the Christmas Recess?

Mr. Butler: I think that it is likely that we shall adjourn for the Christmas Recess on Friday, 20th December. I cannot at present give the date for resumption, but I will do so at the earliest opportunity.

Mr. Lee: To assist the right hon. Gentleman in his avowed objective of dispelling the doubts of hon. Members, can he give a date on which he would be willing to permit the House to debate the Motion standing on the Order Paper, in the names of about 80 hon. Members, which condemns the Government's policy towards wage negotiations?

[That this House condemns the actions of Her Majesty's Government in abusing its political power by destructive interference with the established processes of collective bargaining in nationalised industries, and attempting to condition the minds of those who serve on Arbitration Tribunals to refuse applications for increases in wages, irrespective of the merits of such claims; and that it is convinced that a continuation of these policies will result in the breaking down of the negotiating machinery in these industries.]

Mr. Butler: I think that we have had a good deal of discussion about this at Question Time, and in the course of debates. I have not at present anything more to add to the enlightening replies already given by Her Majesty's Government.
Proceedings on the New Towns Bill exempted, at this day's Sitting, from the provisions of Standing Order No. 1 (Sittings of the House).—[Mr. R. A. Butler.]

Orders of the Day — POST OFFICE AND TELEGRAPH (MONEY) BILL

Order for Second Reading read.

3.49 p.m.

The Postmaster-General (Mr. Ernest Marples): I beg to move, That the Bill be now read a Second time.
The first thing that I did when I knew that the Post Office had to submit the Bill to the House was to look at the previous debates. I found that there were two features of those debates. First, the Postmaster-General who opened each debate always spoke for a very long time, and a disproportionately large amount of that time was spent upon the accounts and the relationship of the Post Office with the Treasury. I hope that as we have introduced new accounts that difficulty will he minimised upon this occasion.
The second thing that I found about each of these debates was that the Postmaster-General emphasised the past achievements of the Post Office—which are considerable—instead of looking at the future. On this occasion I think that it would be for the convenience and assistance of hon. Members if I spent some time in looking at the way in which the Post Office sees the future, and the methods it proposes to adopt to tackle future problems.
I thought, therefore, that I would first speak about the accounts as shortly as possible—and any questions which hon. Members raise will be answered by my hon. Friend the Assistant Postmaster-General—then look at the telephone section of the Post Office, especially towards the future, and finally at the postal side.
We have made an alteration in the accounts this year which I hope will commend itself to the House. Shortly, it is that the amount of borrowing that we shall do in the Post Office in future will be determined more realistically, and will be done after we have taken into account the amount of money which the Post Office ploughs back into the business. As you probably know, better than any other hon. Member, Mr. Speaker, the Post Office is both a business enterprise and a Government Department, and in that respect is unique. It therefore has to keep two sets of accounts—a commercial

account, which shows the profit and loss in the best traditions of commercial accounting, and a cash account, so that it conforms to Parliamentary requirements.
I want, first, to deal with the commercial account. There are two features which are deserving of attention. First, depreciation is based not upon historical costs, but upon current values. That was decided in the White Paper of 1955. Secondly, the commercial account is used to decide the charges which are made to the public. From that there flows the conclusion that the depreciation charged in the commercial account is matched by income from the public. The Post Office collects from the public, by way of charges, what is charged as depreciation.
For the first time the cash account, which is kept from a Parliamentary point of view, is brought into line with the commercial account, in this way: The amount that the Post Office charges as depreciation in the commercial account, and which it receives in cash, is now ploughed back into the business and used to purchase any assets which the Post Office wants. Secondly, any extra capital which is needed will be asked for in this House by way of Bills similar to that which is before us today.
That is realistic, and I think that it clear up a great deal of the confusion which has occurred in the past. In the next two years the Post Office will be spending about £180 million on capital expenditure. Of that, £105 million will be by way of depreciation, and ploughed back into the business by the Post Office. So 57 per cent. of our capital requirement, or £105 million, will be found from internal charges and the balance of £75 million will be borrowed from the Treasury, via the Bill.
That is the simple and commonsense method which will be adopted in the future, and which will bring the cash account into line with the commercial account. I think that it will enable us to spend far less time wrangling about this point in the future than we have spent in the past, and I hope that this change commends itself to the House.
Of the £180 million in the next two years, most will be spent on telephone development, and the House will always have in front of it broad details of the way in which the Post Office intends


to spend the capital which it gets, whether by way of depreciation or by borrowing. Of the sum of £180 million, the vast proportion of £167 million will go to telecommunications; £6 million to telegraphs—mostly Telex—and £7 million to postal services. These changes have been blessed to some extent by an outside firm of chartered accountants whom I asked to make recommendations. Messrs. Peat, Marwick, Mitchell & Co. came into the Post Office, examined what we were doing and made recommendations.
I am reasonably happy about the changes which are taking place, but there are one or two aspects about which I am not yet wholly satisfied. First, the Post Office, alone amongst large commercial undertakings, has to keep two sets of accounts—a commercial account and a cash account, as I have said, which is wasteful. Other large concerns, such as I.C.I. and Unilevers, do not have that imposition. All I would say at the moment is that I am not happy about the position and, therefore, propose to examine it more closely during the following year.
The second reason why I am not happy is that the Post Office is a large commercial undertaking—about the second largest in the country—and employs 350,000 men, which is almost equivalent to the number of people in seven constituencies. That is why I think it should be run as a business. Anything which tends to impede that business, such as methods of procedure, should be examined extremely carefully.
I believe, nevertheless, that in common with other nationalised industries it should be subject to the overall limits of capital investment and should first inform the House, and also the Treasury, of its broad objectives. The detailed composition of the programmes of the Post Office, however, is another matter, because it is clear that the Post Office must exercise its own commercial judgment. General policy demands that; otherwise, it cannot run efficiently. As a child of private enterprise I am bound to stand by that principle. It is quite absurd to suppose that the minute details of commercial investment programmes can be effectively controlled by any outside authority.
Having said that about the accounts, I hope that that aspect of the Bill will have a tranquil passage in the House, although I realise that the course that the House may adopt is unpredictable.
I now turn to the presentation of the accounts. This year we have adopted a new form of presentation of the commercial account report.

Mr. C. R. Hobson: It is the right colour, too.

Mr. Marples: It is the right colour from the point of view of the Post Office, but the wrong colour politically. The account has been streamlined; it is more lucid, and clearer than in the past, and the report is cheaper. It was formerly 3s. 6d. and now, in line with general Post Office policy, it is 2s. 3d.
I want to take the House into my confidence on the question of the commercial account. I had to decide whether we should start a new type of account this year or wait until next year and improve it still further. I decided that it was far better, this year, to commit the Post Office and everyone else to a new form of account which would be understood, even though it were not as perfect as we could make it. I should welcome any suggestions from hon. Members between now and next June on how to make that set of accounts and report very much better. I hope, therefore, that with that very short explanation I can get rid of the actual cash side and come on to the business side of the Post Office.
The amount of money that we in the Post Office have for telephone investment has never been enough in the past, is not enough now and never will be enough in the future. That applies to almost every expanding business. Debates in the House have raged round that point for many years, but I suggest that we have missed two things. The first is whether we are getting value for money. It is no good deciding to give so many millions of pounds to a business unless we know that that business is spending it wisely. I wonder whether we have had purposeful direction of pure science and shrewd timing of applied science in the past. We should look at the long-term programme very carefully, therefore, and that is what I propose to do today.
Secondly, when we have an asset, do we use it to the maximum of its possibilities? Quite frankly, we have not


done so in the past. For example, in the White Paper "Full automation of the Telephone System," which was introduced on 13th November, we started a new set of telephone charges from 1st January next. I tried to explain to the House how we arrived at the method of making the charges cheaper. There were two stages. The first stage was the stage which is to start on 1st January and the second stage was the subscriber trunk dialling, which is to start next year. I do not think that the House quite appreciated how the first stage came about. Therefore, I will try to explain again.
At present, if a person dials from Sloane, or Mansion House, or Holborn he is allowed to dial to a very small area. The dialling is done automatically and the charge is registered on a meter which is very like a speedometer. If a person wants to dial to Watford in the north, Croydon in the south, or Slough in the west the machine is capable of dialling those numbers but, because of the complicated charging system, the Post Office has insisted that the subscriber dials the operator first. The operator then gets the call, and that is expensive. Secondly, the operator records the call on a slip of paper and times it. That is expensive. Thirdly, a series of clerks have to sort out these calls afterwards, bill them and charge them to several million accounts. There are 150 million slips of paper every year, which make a formidable task.
Fourthly, and even more important, the Post Office has to keep people on duty for 24 hours a day just in case a person makes a call to one of these places. It is the most wasteful feature of all, particularly as machinery already installed can actually dial the required number automatically. Therefore, by an alteration of the charging system we have done a great deal to simplify matters.
The new arrangement does not apply only in London. I said to the Post Office people, "Is there not an example that we can get in the country which some hon. Members might appreciate? If that example could be allied to somebody who had held office in the Post Office, it would be more effective than ever." I therefore looked at the telephone system at Keighley, in Yorkshire, because that constituency is represented by the hon. Member who is to wind up this debate from

the Front Bench opposite, and who is very knowledgeable on Post Office matters, he having been Assistant Postmaster-General.
At present, one can dial direct at Keighley to six exchanges. As from 1st January, with existing equipment and without one pennyworth of additional capital, people will be able to dial to 28 exchanges, or almost five times as many. At present, one can dial to 7,999 subscribers, of whom I hope the hon. Member for Keighley (Mr. C. R. Hobson) is one, but after 1st January one can dial to 59,902, which is more than seven times as many, with the existing equipment.
Another specific example is that from Keighley, in Yorkshire, to Burnley, in Lancashire—Yorkshire being the second-best county and Lancashire the premier county—it will be possible to dial direct after 1st January for 3d. Hitherto, it has been done manually for 1s. I claim that that shows exactly how we have not been using our existing equipment to the full. Those who take part in debate in the House might perhaps take that into consideration when we are discussing matters of this kind.
All this means, from the point of view of the Post Office, that in the year begining 1st January next we shall save £2 million in wages and salaries. We shall also deal with the operators in the most humane manner, as I shall show later. Secondly, and even more important, is the fact that £10 million worth of equipment—and that is a very conservative estimate—would have been scrapped under the old system, but now can be used for many years. That gives the Post Office a great deal more money to play with in other directions. Therefore, I maintain that value for money in what we spend now and the maximum use of our existing assets is equally as important as the capital sum that one manages to squeeze out of a reluctant Chancellor of the Exchequer, to whatever side of the House he belongs.
I have found that in business the first question asked is, "Where is your largest asset and what use are you making of it?" I found, in the Post Office, something which, frankly, surprised me. It was that the biggest single asset that the Post Office possesses is the cables which lie buried under the streets. The Post


Office has £150 million worth of money buried under the streets, and it is adding to it at the rate of £11 million a year. The first question to be asked is, "Can we make more use of that equipment, in the same way as we have already made more use of the exchange equipment?"

Mr. William Shepherd: Will my right hon. Friend say what will be the net effect on Post Office finances of these changes in the charges for dialled calls?

Mr. Marples: The changes will actually cost £8 million, of which £2 million will be saved. We shall also have the use of the £10 million which I have mentioned and which was taken into account in the increase of tariffs previously announced. The Post Office revenues for the following year, which I estimated when I asked the House for an increase of £42 million to meet increased wages, have taken that into account. The assessment which I then made of Post Office finances still stands.
What I found on the question of these underground cables was most illuminating. With electricity, if there is a main trunk running through the street each house can tap off that main trunk quite easily. The same applies to gas mains, but that does not apply to telephone cables. Every telephone subscriber must have two wires which run direct to the exchange from his house. They are his exclusively, whether he is two miles or three miles away, or just one mile away. The House will see how expensive that can be.
The scientists have not yet found a way of doing with telephones what is done with gas and electricity. Therefore, one comes to this: how can we use to the best advantage the existing wires which are buried under the street? Let us assume that at present there are 20 subscribers in a street two miles from the telephone exchange. They have 20 pairs of wires, a pair each, going to the exchange two miles away and back again.
I wonder whether we could bring a tiny bit of the exchange to the end of that street, connect the subscribers to that particular part and then run four pairs of wires, instead of 20, to the exchange, thus saving 16 pairs of wires for

the most part of two miles? If we did that, we would use to the maximum capacity the wires we buried. That is one of the moves that we are now tackling to bring this tiny bit of equipment—it is called the automatic line concentrator—into operation, and we are intending to press on with that just as fast as we possibly can.
I come to another point. I wonder whether the House knows how much it costs the Post Office to to connect a telephone subscriber. The following figures are very rough, but they will at least give the House an idea of the magnitude of the cost. The telephone itself costs £9, the equipment at the exchange costs £16, but the wires under the road cost £85. That is a total of £110. It is, therefore, quite clear that any saving that can be made could best be made on the wires.
We have found in the Post Office that it would be possible to use thinner wires and lose efficiency but, at the same time, get a better telephone which is more efficient and so make up for the loss of the signal in the wire itself. As we can make a better telephone for the same cost as the existing one, we shall save a considerable amount in the cost of wire.
We shall save not only on the wire itself, but on the method of laying that wire. We have, under the roads, ducts which now house a certain number of thick wires. If we have thinner wires we can get far more of them into an existing duct. One of the most expensive operations in the world is civil engineering, as I well know, as one who has had something to do with civil engineering. I am doing great injury to the private enterprise interests I represent, because we shall not tear up those metalled roads and put in bigger ducts, but will put in thinner wires and get half as many again into the existing ducts. That will save an immense amount of money.
Now I should like to look at the exchange itself. In all business affairs a person wants to keep in his mind what is his ultimate aim. He may never achieve it, but he wants to know what it is so that all the intermediate steps will be in that direction. The aim with the exchange equipment is that we should have an all-electronic system, suitable not only for tiny laboratory experiments but such


as will withstand the rigours of day-to-day wear in the public service.
In 1960, at Highgate Wood, we hope to have the first ail-electronic exchange in operation. In passing, Mr. Speaker, I should like to say that I am glad that it is to be at Highgate Wood, because that was in the constituency of a very old friend of mine, Sir David Gammans, who played such a large part in the Post Office for many years as Assistant Postmaster-General.
We want an all-electronic exchange, first, because it is cheaper to produce. Electronic equipment, unlike mechanical equipment, is not precision made. Secondly, it is cheaper to maintain which, as most hon. Members will know, is of prime importance. Then, it takes slightly less room to house and is lighter which means that the foundations—and again I am taking away from the civil engineering industry—will also be lighter. Finally, it is more adaptable to the automatic line concentrator that I have already mentioned. That is what we aim to get.
How has this exchange equipment been achieved? It has been achieved by what is known as the Joint Electronic Research Committee. J for joint, E for electronic, R for research and C for committee—it is known as J.E.R.C. The Joint Electric Research Committee is a partnership between the Post Office and private enterprise, with the Post Office in the chair. We have pooled ideas, and have allocated specific tasks, some to the Post Office and some to various private firms. We have avoided duplication and have concentrated our effort.
I should like to associate myself with a supplementary question recently put by the hon. Member for Openshaw (Mr. W. R. Williams), who asked whether that did not mean that the Dollis Hill research engineers had done extremely well. The answer is, "Yes". The Dollis Hill research engineers have done a fine job of work, in co-operation with private enterprise—which is what I think should happen. I do not see why we should always have this competition between a nationalised industry and private enterprise when, in point of fact, they can be complementary and not competitive. I shall say something more later on that point.
I come to a third point about telephones, which is better known than the

two I have already mentioned but, again, looks into the future rather than mirrors the past. It has been spectacular, and the dividends have been greater, especially for the trunk calls. I refer to the coaxial cable, introduced long before my time. It has immense possibilities. Before the war, when you, Mr. Speaker, were Postmaster-General, there were two pairs of wires for every conversation on trunks, and one pair for local conversations. But a single coaxial cable can now actually carry 960 conversations at the same time, by using different frequencies.
The problem we shall face in the future when subscriber trunk dialling comes in will be this. We shall want more trunk lines than we now have, and we shall want them because, next year, it will be possible to phone from Bristol to Aberdeen—a short conversation—for a few pence—about 5d. or 6d. Therefore, when we let the public loose on dialling on trunks as they now dial for local calls we shall want more lines, but the question is, "What shall we do?"
There are two things that we can do. The first is to put in another duct and another coaxial cable. An alternative is to make better use of the existing coaxial cable, which, as I say, with repeaters at every six miles, conveys 960 conversations. If, instead of laying another cable, we put in an extra repeater—that is, a repeater every three miles—one of two things happens. First, we can double the number of conversations from 960 to 1,920, or we can have the existing 960 conversations plus a television channel.
I do not know whether hon. Members quite realise that television is not just as simple as relaying from a transmitter to a receiver. The Post Office is called upon to take very good programmes and to give good definition from Manchester and Birmingham to London, from the studios to the transmitter, and so on. What we really want is to get interchangeability, on the lines we have, between telephone calls and T.V. and sound broadcasting.
By the use of these repeaters we shall double the capacity of the existing investment buried under the ground, instead of putting more investment there. We have the best network of coaxial cables in Europe, and I hope that when subscriber trunk dialling starts we shall ultimately save £15 million a year by getting the subscriber to dial for himself, instead of


having it done through an operator. The ultimate aim of the Post Office should be defined, because we ought to know which way we are going with telephones.
I think we should arrive at the position where anyone anywhere can pick up a telephone and speak to anyone anywhere else, subject to three conditions. He should be able to do it quickly, clearly and at reasonable cost. We can do that only if we have a long-term plan clearly defined and if we sweat the equipment and not the men, and we make the decision now to stand for a long time ahead.
As hon. Members will see if they have studied the recent White Paper carefully, decisions have now been taken on policy for the next decade. We have settled group charging, which starts on 1st January, which will alter the whole telephone system. Dialled trunk calls will start next year from Bristol and will spread rapidly afterwards. For the next ten years the way of telephone policy is charted. Provided that we work hard enough, we shall have a telephone system to be proud of which will give us extremely good service at reasonable cost.
Having dealt with the telephone, I want now to come to the postal side. The postal side is a far harder nut to crack than the telephone side. The methods of handling the mail at present are the same as they were a hundred years ago. They are the same as they were a hundred years ago all the world over. The question is: Are we satisfied that that should go on, or should we alter our methods? What is the problem? I would like to take the House through the way I looked at it when I first went to the Post Office.

Mr. W. R. Williams: I would like the Postmaster-General to enlarge on that point, because in my experience there have been very big radical changes. They have not been fundamental changes, but changes of procedure. I think we ought to be clear on that point.

Mr. Marples: I will certainly gratify the hon. Gentleman's wish, and enlarge on that.
Basically, the procedure in the Post Office now, for example, in sorting, is precisely the same as it was a hundred years ago. A man has in front of him a framework, with 48 pigeon holes. It

is 48 because that is the extent to which his arms will reach. He reads the letter with his eyes and puts it in the box by hand. If we cling to that method we shall never reduce the cost of the postal services. Basically, the methods are still the same. There have been refinements. Our ultimate goal has not been clearly defined. I shall attempt to define it this afternoon and I shall mention a number of things which I am sure the hon. Gentleman has in mind.
What happens in the postal services during the time from when a letter is posted to when it is received? Suppose the former Postmaster-General asked me to a very expensive lunch at the Savoy at his expense and he sent me a letter from Caerphilly, in South Wales, to Wallasey, in North-West England. What happens to that letter? The hon. Gentleman would post it in a pillar box at Caerphilly, or probably he would send his hired man out to do it for him. Then one of the postmen would collect it from that box and take it to the Caerphilly Post Office.

Mr. S. O. Davies: It is "Caerphilly" with a long "a".

Mr. Emrys Hughes: No, it is with a short "a".

Mr. Marples: I accept the correction of the hon. Gentleman the Member for Merthyr Tydvil (Mr. Davies), but not the correction of the hon. Member for South Ayrshire (Mr. Emrys Hughes).

Mr. Hughes: Is the hon. Gentleman aware that I was born only a few miles from Caerphilly?

Mr. Marples: That explains a lot of things which I have not understood in the past.
At Caerphilly, the letter would be faced so that the stamp came the right way. Then the stamp would be cancelled so that I could not use it again. After that, at Caerphilly—I will be glad when I reach Cardiff—it will be sorted into one of the 48 pigeon-holes by a third postman, who will put it in a box to Cardiff. The first postman collects it from the pillar box, the second one puts it in the facing machine, and the third one puts it in one of the boxes.
The letter then goes to Cardiff and is sorted. The postman puts it in a pigeon


hole, one of another 48, to Wallasey. Then it is put into a small bag to Liverpool. At Liverpool, the small bag is forwarded to Wallasey. At Wallasey, another postman comes along, picks it out and puts it into one of 48 boxes for a specific postman at Wallasey. Postman No. 5 has then touched it. It then goes to postman No. 6, the man who will deliver it, and he puts it into a box for a particular street. We have had six postmen touching that letter, four of whom have been engaged in sorting. Unless we crack that system, the postal services will never be cheap.
Of the total cost of the postal services, manpower accounts for 70 per cent. It amounts to £120 million a year. Of that, sorting amounts to £40 million and the cost of delivery is £30 million.

Mr. E. Shinwell: What is the average cost of delivering a letter?

Mr. Marples: The right hon. Gentleman can do that arithmetic by dividing £30 million by the number of letters the Post Office handles a year. I cannot do it on the spur of the moment, but I will write to the right hon. Gentleman and let him know.

Mr. Shinwell: It might be cheaper and easier to deliver our own letters.

Mr. Marples: That may be so.
I would like to concentrate on the sorting problem. It is the delivery problem which catches the eye of the public, but the sorting problem is of equal importance. My business friends have proffered advice to me since I became Postmaster-General. Everybody knows how to run the Post Office except the Postmaster-General and those who run the Post Office. My business friends say to me, "Why do you not sort in the way we carry out the punch card system?" When there is a punch card system in operation—for instance, Powers-Samas machines—we have two conditions. First, there is a standard product which is the right shape, the right weight, the right thickness, and with a straight edge. The second condition is that there is a standard code. One punches the holes in it at a certain distance from one of the edges.
Neither of those conditions applies to the Post Office. The product concerned is anything but standard. It is an

immense variety of size and pattern. There are flimsy envelopes with windows. There are envelopes sent by the tax inspectors, who are asking for far too large sums of money, in which they put a sticky label to be put on another envelope. There are large envelopes sent by lawyers to justify their extravagant fees, with thick, bulky documents inside. We have not a standard code.
Addresses written by people in strange lands far away are generally indecipherable and often wrong. [Laughter.] Those who laugh at that must know that some of the addresses in Scotland are extremely long, and some of the handwriting in Scotland, although excellent in its way, is difficult for a foreigner to read. Therefore, we have not the same conditions in the Post Office.
Let us pause to look at what we have. Here I will agree with the hon. Member for Openshaw. The Post Office has made, at Dollis Hill, an immense contribution to finding and inventing machines which would mechanise a great deal of the sorting, but, basically, we have not yet altered it. They have done a great deal of research work. I will convince the House shortly that our machines are in advance of the world.
We already have, at Southampton, the first electronic sorting machine, which does not sort into 48 pigeon-holes by hand. It sorts into 144 pigeon-holes. It does it electronically and mechanically. The letter comes into a window, and it is read by a postman, who presses a combination of keys in front of him. That information is recorded on the electronic part of the machine and that letter is moved mechanically into the box. That is a tremendous advance. It makes 144 sortations instead of 48. It is much more precise. Twenty of those machines have been ordered during my term of office and the first of them will be available on 1st April next year. It will be installed. I think, at Norwich, but most of them will follow very quickly afterwards.

Mr. William Ross: The right hon. Gentleman should be fair to past Postmasters-General. He has been able to order the machine only because it had completed successful field trials. The idea was started long ago.

Mr. Marples: I did not say otherwise. I am coming to that point almost immediately. The hon. Member is always impatient. He never lets one really finish what one is saying. Had he waited for me to say it at the end of my thesis—it is difficult at this stage, because I am looking into the future—it would have been more appropriate then than when the hon. Member intervened.
As I have said, we are in advance of the rest of the world. This week I telephoned the Postmaster-General of the U.S.A. and the Postmaster-General of Canada. I invited both of them over here, because they both want to see this machine in action. It is the result of intensive years of work of research by the Post Office and it will, I hope, be the foundation on which we can crack this sort of problem. The credit, if credit must be allocated, goes to the scientists at Dollis Hill who persevered through the tenure of office of successive Postmasters-General, never mind a single Postmaster-General.

Sir James Duncan: Will my right hon. Friend refer to the exhibition in the Upper Waiting Hall, where photographs of this excellent machine are being demonstrated?

Mr. Marples: I am grateful to my hon. Friend. It is extremely difficult to explain these technical matters in a speech without any visual aids. One cannot bring cables and photographs into the Chamber. I have, therefore, arranged in the Upper Waiting Hall an exhibition in which various things which will be referred to by myself and by my hon. Friend the Assistant Postmaster-General during the debate will be available for hon. Members.
What the Post Office has to define is our ultimate goal in sorting, so that, in the first place, all the intermediate steps will then be taken broadly in that direction. We must have a machine in which an electronic eye, and not a man, reads the address or the code and actuates a machine mechanically, the machine to sort the letters automatically and the envelopes never to be touched by hand from the beginning to the end. That is the ultimate goal. It is a long way off and it will not arrive in my time or for many years yet, but we ought to define it.
That involves two things. The first is that we may have to have a standard envelope. The machine cannot deal very easily with a thousand different sized envelopes. If a person buys a Rolls-Royce, with a special body, he pays the price for the hand-made job. If somebody wants a machine-made car, he buys, perhaps, a Ford, with its standard length, width and size; he takes the standard product. Without any shadow of doubt, the public will have to decide whether they want mechanisation, with the standardisation that it will inevitably entail, or whether they want a hand-made job and are prepared to pay for it.
I want, therefore, to try to set out the methods that we ought to adopt to try to crack this postal problem. The first concerns research—and this was where I wanted to pay the tribute. I want to pay a tribute particularly to—I ought not, perhaps, to call them Civil Service engineers—the postal engineers at Dollis Hill, which is the finest establishment of its kind on postal research, and to the foresight of the men who started it and to the devotion of those who continued it.
By itself, however, in this modern age, that is not enough. We must have cooperation with other countries in research, because it is complementary and not competitive. I hope, therefore, that we shall arrange that the U.S.A., Canada and ourselves will share ideas in research and pool the results, that we shall have regular meetings to that end and that we shall not have a duplication of effort. In addition, there is an International Committee for Postal Studies, in which every nation is involved, but that would be a much slower process than getting the three countries together.
This arrangement began with a visit by the Deputy Postmaster-General of the United States, who called, in that refreshing, spontaneous manner in which Americans do, at the General Post Office one day without notice. Knowing the characteristics of his country, I agreed to see him; they are like that over there and one must accept it. We had a sherry, at my expense and not at Post Office's expense. Then we talked about this problem. That was in the late summer. As a result, a team of five G.P.O. officials went to study mechanisation in Canada and in the United States. They returned last Saturday and on Monday we had a Press conference.

Mr. Ness Edwards: Oh, that is very important.

Mr. Marples: Surely it is. I am sorry that the right hon. Gentleman ridicules something like that. If the Post Office does not take the public into its confidence, it will not get where it wants to get. The public have a great part to play in this. They have decisions to make. If the right hon. Gentleman wants me to go further, let me say that on Tuesday I telephoned the Americans and the Canadians and they have agreed to come over here. The late Sir Stafford Cripps started the Anglo-American study groups or teams which went over to America to learn from the Americans.
Now, an American-Canadian group is coming here, in the reverse direction, to learn what we know. They will be here early next year. We shall have, I hope, an exchange of patents, and so on, and I hope that between our three countries, with the resources, the enthusiasm and the money of the three of us, we will crack this problem far quicker than we would do otherwise. My first point, therefore, is that we should not go it alone in research.
My second point is that the public has a great part to play. I am starting a scientific survey early next year to find out what the public expect and want from the postal services. Do they want several deliveries by hand every day, one a week, or what do they want? Do they want a first-class mail or a second-class mail? After all, we are servants of the public. Let them say what they want. But when they say what they want, they have to pay for it. They must make up their minds. How far will they co-operate with us? Are they prepared to use coding? We may have an intermediate stage in which the postman himself puts the code on the envelope from the address.
Will the public ultimately be prepared to have a code number? After all, they have code numbers for motor cars and for telephone numbers and already, to some extent, in addresses, because when they write to this House, for example, they use the code "S.W.1". Will they take that further and have a series of five or six letters or numbers which would enable a machine to do the work which the men now do?
We must wait for that report from the public. I hope that people will not write

direct to me with their ideas, because we shall have the survey done scientifically and I shall have only to pass the results to the committee. When we know what the public want, would it not be a good idea if we chose an experimental town for a trial, to see whether the public would accept the code method? So much for the public.
Now, about the Post Office. The Post Office must assemble, first, what it thinks is practical and can be done, and secondly, the reaction of the public. There is, however, a great difficulty. It is extremely difficult for any Government Department to tell the public what they want, because if it does, the public never believe what it says, whether it is right or wrong.
As a matter of principle, the Post Office will have to consider the appointment of a committee of business people and representatives of the public to advise the Postmaster-General of the day, and when the information has been assembled the Postmaster-General will know what to do. We could invite the assistance of businessmen who conduct fairly large enterprises, and perhaps some who use the Post Office a great deal, such as the pool promoters. They could give the benefit of their valuable advice to the Postmaster-General. Whatever they said, the public would accept more readily than anything the Postmaster-General might say. That is one of the things I propose to do—if I am still in office.
I am not just making a speech about this, because I have done precisely that thing with, the telegraph service and this is the first announcement about it. I have appointed a committee with these terms of reference "to advise the Postmaster-General on the future place of the inland public telegraph service as part of the communication facilities of the United Kingdom." The Chairman is Sir Leonard Sinclair, Chairman of Esso, and I am grateful to him for agreeing to undertake the task. He will have the assistance of a number of other committee members who will have the benefit of the public survey which we have carried out. All the facts will be placed before them and they will be at liberty to make any inquiries they wish. At the conclusion a report will be published. Therefore, one of the major headaches of the Post Office, the telegraph system, will be subject to


this scrutiny and we shall see how we get on then.
I have mentioned the telephone and postal services and I wish now to refer to a number of sundry items. First, I will deal with buildings. We should have more prefabrication and standardisation in our buildings. We have started a joint research and development group with the Post Office and the Ministry of Works. I meet them once a month and receive a report about what they are doing; although for the last nine or ten months I have been so busy that I have not been able to devote the amount of attention that I would like to this side of the business. But I propose to do so during the coming year.
The second thing is the question of partnership with industry. I see no reason why there should always be wrangling between a nationalised industry and private enterprise. For years there has been a great partnership between the Post Office and private enterprise. It has been growing and I want to make it grow faster. Technical development has been steered by a joint committee under a Post Office chairman.
I have mentioned the electronic exchange. We cannot turn out the working equipment as quickly as the rest of the world unless we pool our research efforts, I do not have only Post Office requirements in mind. I hope to meet the chairmen and technicians of various firms during the next week or so—certainly before Christmas—to see whether, as Postmaster-General, I can take any positive action to assist in the export of modern telecommunications in partnership with private enterprise. I shall offer my suggestions to them and ask for theirs. If they do not want my suggestions, or if they have no suggestions of their own to offer, I cannot be blamed, because I shall have done the best I can.
I was struck by what happened in the case of a near-eastern country, after the war. I learned from a Post Office official that we were competing with Germany to sell equipment to a Near Eastern country. In Germany, they had only a single manufacturer and the Postmaster-General went out to this country himself and dined and wined a number of people. Several groups of

manufacturers visited the country and, finally, one of the engineers went out and the initial order for equipment was "bagged" by Germany. The initial order was the most important because subsequent orders followed naturally.
Therefore, I propose to offer my services, such as they are, to private enterprise firms to see whether we can get even closer together and cement the partnership, and create a satisfactory and fruitful dollar-earning source for the benefit of this country.
The third thing I wish to mention among the sundry items is the question of aesthetics—

Mr. W. R. Williams: I had hoped that the Postmaster-General would say some more about building. He seems to have skirted away from that subject after remarking that he wanted more prefabrication and standardisation. I am interested in what he has in mind and I should be grateful if he would say something more on the subject.

Mr. Marples: I have a great deal more to say, but I have been speaking for 50 minutes, and it is a difficult matter to condense all that one would like to say—

Mr. Williams: But this is important.

Mr. Marples: It is all important, but I do not want to bore the House. However, if the hon. Gentleman wants to know about buildings, I will tell him.
I want to interest the trade union representatives and bring them in with me to decide what equipment we should have in the buildings. We should make counters prefabricated so that they can be slung together, and they should be made to one individual architectural design instead of having a different design for each Post Office in the country. I am anxious to do again what I did to assist my right hon. Friend the Prime Minister when he was at the Ministry of Housing and Local Government and I was Parliamentary Secretary.
I want to do something about telephone exchange equipment—the hon. Gentleman asked me about this and he must forgive me if I take time in answering him. This is what happens now about exchange equipment. The Post Office erects a building at Bournemouth as an exchange building to last for twenty-five years and cover


all the requirements for that period and then a quarter of it is filled with equipment. Three-quarters of the building is wasted completely as a capital investment because it will not be used for twenty-five years. There will be no revenue from it and, what is more, there will he the expenditure of maintenance, and so on.
I wart to try to get 2,000 or 3,000 lines of exchange equipment completed, together with the building, and erect it so that it can be extended by units. We require standardisation in building while, at the same time, paying due regard to aesthetics. I can assure the hon. Member that there are many ideas running round in my mind. That matter has not been neglected, but one cannot do everything at once. Standardisation and mechanisation do not necessarily mean ugly buildings although people may think they do. Take letter boxes, for example, for which we have now decided on a standard pattern with the right type of aperture, and so on. The Council for Industrial Design, for which I have a great regard, has helped. I am grateful to my hon. Friend the Member for Cheadle (Mr. Shepherd) for persuading me to consult the Council.
I hope to do something about telephone kiosks. The present kiosk was first constructed of cast iron in 1920 to a design by Giles Scott. I think that the idea was absolutely brilliant at the time, but during the intervening thirty years we have found new materials which would enable us to construct the thing differently; and it is the structure which decides the line, the aesthetic line, which can be adopted. With the Council for Industrial Design and the Royal Fine Art Commission we have decided on three designers who will submit designs for a new type of kiosk. I shall erect a number of samples and ask people what they think of them. If they do not like them, we will not have them; if they are good, we will. I cannot say more. The three people who are submitting designs are Misha Black, Neville Conder and Jack Howe, all eminent in their respective spheres. This is the first time it has been announced.
My right hon. Friend the Prime Minister often quotes Trollope. One of the ways in which people have gone wrong is in trying to make some construction conform with aesthetic considerations by camouflaging it. During an argument in this House with the right hon. Member

for Ebbw Vale (Mr. Bevan) I said that the real difficulty about the Central Electricity Authority was that it was trying to build power stations which looked like cathedrals, while the cathedrals looked like power stations—

Mr. Ross: No.

Mr. Marples: That is perfectly true. [Interruption.] The hon. Gentleman can make his contribution to the debate later and I shall listen with great interest.
In the early stages of the power stations they put Portland stone round them. Why did we want to have Portland stone around the power station which faced the Yorkshire Copper Works, at Leeds, and is never seen by anybody except the people who work there? More than £100,000 was wasted in that way, and we did not get value for our money. It reminds me of the remark made by one of the characters of Anthony Trollope about a woman who never appeared until 11 or 12 o'clock in the morning, when she was heavily rouged. He said that she spent far too much time constructing the decoration and too little on decorating the construction. The materials that we use are a very necessary factor in the aesthetics of our buildings.
I come to the last of the four points, which is about the forms which the Post Office sends out. Matters like automation, standardisation and mechanisation should not mean lack of the human touch. The forms which the Post Office send out—this applies to a lot of other Government Departments—are very rigidly phrased and sometimes give offence. We have set ourselves to reword all the forms sent out by the Post Office. [HON. MEMBERS: "Hear, hear."] It will be some time before we reach them, because we have stacks of the old forms.
I would quote from the Daily Mirror of Tuesday, 26th November, in which that dispassionate gentleman, "Cassandra", gave us great credit for this change. He said:
Applications for unpaid telephone bills after the first demand have hitherto been masterpieces of threatening incivility. The custom has always been to growl away about the line being disconnected and how much it will cost you to get back on the service again. I welcome the primrose mood of the new application.
Then he went on to say what was said.

Mr. Ede: Has he paid his bill?

Mr. Marples: I come to an even greater testimonial. I have never yet in the whole of my experience in this House, twelve or thirteen years, had a compliment from South Wales. The right hon. Member for Ebbw Vale and the right hon. Member for Caerphilly (Mr. Ness Edwards) have made eloquent speeches, using mellifluous phrases which fell melodiously on the ear. Their speeches never disagreed with me on broad policy but only on small details.

Mr. C. R. Hobson: That was not the right hon. Gentleman's experience at the Ministry of Housing and Local Government.

Mr. Marples: I have had a letter from Caerphilly, dated 21st November, from quite a big business firm there. I would like to read it to show the impact of this new idea on the public. It says:
Dear Mr. Marples".
That is a good start. This makes up for what the right hon. Gentleman the Member for Caerphilly did in his constituency. The letter goes on:
I should like to congratulate you on the new wording appearing on letters from the Post Office Telephone Organisation chasing up the payment of telephone accounts. It is with much less displeasure than usual that I shall be sending my cheque to your office in Cardiff. I sincerely hope that this changed outlook by a Government Department will spread throughout our country and that we shall no longer get pleasure out of deliberately withholding accounts so as to see how rude some of them can get.
All I can say is that if someone from South Wales pays his account promptly and, in doing so, thanks me for the letter I sent him, it is a red letter day in my experience.
Now let me get back to the human side of automation—we have to get some automation into the Post Office—and then I am through with my speech, over which I have taken too long already. Let us look how mechanisation affects various people. For the scientists there must be a long-term plan and purposeful direction, because their efforts have to be tried out in the field, under the most rigorous conditions and not in the laboratory. Administration must have new thinking and development. It has to alter procedure. We have to get more

technicians who will ultimately take up administration than we have had in the past. Only then can they appreciate how to help the public to help themselves.
Now I come to the staff. Scientists, administrators and the public may have difficulties with automation, but it is of absolutely vital concern to the staff. In the White Paper on automation I have a paragraph on consultation with the trade unions. I will not bore the House by reading it, but I commend the reading to hon. Members. I start off by saying that the greatest problems of automation are not in the technical field; the human problems are much greater. I believe that to be true. Automation means more men and women displaced, a smaller staff is required and career prospects are jeopardised. I must be very careful in this House when I mention trade unions, because there are trade unions and trade unionists—

Mr. Harry Randall: It is very refreshing to see a White Paper once in a while in which "trade unions" are mentioned rather than "staff associations", which has been the phrase used for many years.

Mr. Marples: Some trade unions like to co-operate late in life while others want to co-operate earlier. The Post Office trade unions—I say this honestly as a product of private enterprise—are absolutely first rate. Never had I better trade unions or staff associations to deal with. Generally speaking, in private enterprise one decides what machines to introduce and says to the staff, "How can you manage with them?" I believe that is not going far enough.
I have a policy committee which advises me on mechanisation and I have appointed two people to it. One is Mr. Smith, General Secretary of the Union of Post Office Workers, and the other is Mr. Hodgson, Chairman of the Staff Side of the Post Office non-Engineering Whitley Committee. They are on the committee not necessarily to solve the problems although they can make a contribution if they want. They can spot the problems for their unions. Co-operation can hardly be taken further than that.
There is a great deal of work to be done in the Post Office in the next fifteen or twenty years, long after my time. The Bill is an improvement on previous


methods and I commend its Second Reading to the House with great confidence not only because of what has been done in the past over a period of years, but because of the spirit which animates the Post Office. I hope that the House will give the Bill a Second Reading without a Division.

4.59 p.m.

Mr. Ness Edwards: The right hon. Gentleman has been good enough at least to exceed the efforts of all previous Postmasters-General. He has made about the longest Second Reading speech we have had on a Post Office Bill. We shall wait and see whether it is the best.
Much of it has been related not to the matter under discussion but to a description of the future. It has been obvious that the right hon. Gentleman has been infected with the enthusiasm that all his predecessors have had when they went into the Post Office, which is an extremely interesting place. I do not think any ex-Postmaster-General has come from the Post Office without a great deal of affection for that institution and a great deal of praise and appreciation of the Post Office staff.
One would like to put it this way, that all Postmasters-General like to bathe in the reflection of the technical achievements of the staff of the Post Office. What the Postmaster-General is able to talk about on the Floor of the House is largely the result of what the backroom boys have done. In a way, he takes credit—I do not object to that at all—for what his office has performed, but, as the right hon. Gentleman will appreciate from his speech today, what one sows one does not always reap in the Post Office. Successors come along to reap the harvest, the seeds of which others have sown.
When the right hon. Gentleman talked about the goals of the Post Office, I thought he was retelling to the House a speech I heard by one who was held in most affectionate regard there, old Archie Gill, as he was called—Sir Archibald Gill, Engineer-in-Chief of the Post Office for many years. He was associated in the automation of the Post Office service with Sir Gordon Radley, then head of Dollis Hill and now the Director-General. I suppose that, in that sense, the degree of automation which

has been talked about and is mentioned in the White Paper is really the harvest of the work of Sir Archibald Gill when he was Engineer-in-Chief.
One of the things which worried me at the Post Office was that there was so much to do and so little capital with which to do it. One had to decide what came first. We had to have a set of priorities, and in the short time that I was at the Post Office the first priority was its financial relations with the Treasury. This afternoon the right hon. Gentleman has ignored the first consequences of the White Paper of 1955. In-the White Paper were laid down the principles which were embodied in the first full year of the present commercial accounts which are associated with the Bill.
I can only come to the conclusion that, us the right hon. Gentleman has not talked about the alleged £3 million "in the red" this afternoon, he wants to keep it out of the debate. Quite frankly, I thought he would deal with it. After all, the Post Office seems to be in a mess financially. We have had three revisions of the Estimates this financial year. We have had three White Papers. We have had changes in charges galore—up one day and down the next—but we have not had any discussion or explanation of what has taken place.
As the right hon. Gentleman said in his Press interview, this is the first year in which the Post Office has been "in the red" for something like twenty-one years. I quote the Daily Telegraph. The "twenty-one years" does not matter; it is the first time for very many years. With the exception of the four years of the Second World War, this is the first time the Post Office has been "in the red," or alleged to have been "in the red," since 1913 when Sir William Peat decided on the form of commercial accounts that were to be provided for this House.
The real position is that the £3 million by which the Post Office is alleged to be "in the red" hides a real operating surplus of £18 million. Let us not be deceived by the headline about a £3 million Post Office loss. If the method now employed in this set of accounts and this form of presentation had applied since 1913, with the exception of the


four years of the Second World War, the Post Office would have been "in the red" every year. One would have thought that the right hon. Gentleman would have dealt with that side of the matter, if only for the sake of the reputation of the Post Office.
The handling of Post Office finance by the Postmaster-General in this matter leaves much to be desired. On a number of occasions, I have asked him to try to indicate how the accounts now provided compare with the results of previous years. I call in aid a Question he answered on 30th October. As he wants the Post Office to be treated as an ordinary commercial undertaking, this is very refreshing. The right hon. Gentleman said that, under the principles applied to commercial and industrial firms by Inland Revenue rules for the years 1956–57, the Post Office would have been £15·7 million better off. If the same rules were applied to 1957–58, it would be £16·9 million better off. If the ordinary Inland Revenue rules were applied to the Post Office, instead of its being allegedly £3 million "in the red", it would actually have a £18 million pound surplus. Even if the £5 million now set aside in lieu of taxation were taken into account, the actual surplus this year on these accounts would be £13 million and not a loss of £3 million.
The right hon. Gentleman has very good Press relations. I should imagine that he is the envy of every Minister in the Government. Instead of talking about the new form of accounts, which makes the Post Office look blacker than it is, he has talked about automatic sorting by E.L.S.I.E., which has broken down charges, and G.R.A.C.E which is for reducing charges on the telephone service. Today, instead of talking about the accounts which, after all, will determine what he is able to do in the Post Office, he has brought in the new J.E.R.C. In that sense, the right hon. Gentleman is not playing fair either with his office or with the House.
On the accounts, I wish to refer to the report issued by the accountants, who, I am sure the right hon. Gentleman will agree, have always been advisory accountants to the Post Office. There is nothing new in the Post Office's consulting Peat, Marwick, Mitchell & Co. After all,

Sir William Peat was head of the firm. I welcome the initiative of the right hon. Gentleman in this matter and congratulate him upon it. When he announced the report, I pressed him for a sight of it. He had spent public money on getting a report on a public undertaking, but he said it would be an embarrassment to place it in the Library of the House.
During the Recess, further Questions were put on the Order Paper asking the right hon. Gentleman to reconsider his answer and to produce the report. On the Wednesday when he was due to reply to Questions, he was able to say that the reply had been supplied the day before in a written answer and that a copy of the report was in the Library. I make no further comment on that except to say, that as he admitted, that is not the report he announced in his reply to me.
This is a document which has been supplied at the request of the Director of Finance and Accounts, and it is dated 3rd October. It is a very much revised report and is in an entirely different form from that which the right hon. Gentleman gave. I make no point about that and I am not suggesting that there is any point of substance, but what amazes me is the right hon. Gentleman's reluctance to allow the House to see a report on, as he himself calls it, a Government undertaking. Nevertheless, we now have the report.
In the first place, let me say that I completely support the right hon. Gentleman in his general approach to relations between the Post Office and the Treasury. I am glad that he has at last rejected the view of his two predecessors and of some of his hon. Friends and has embodied in the accounts a step in the direction of his general view that the Post Office is a commercial undertaking, ought to be treated as a commercial undertaking and ought to be allowed to use its money for its own purposes. In that I am completely with him, and I can assure him that he will get all the support I can possibly give him.
Let me quote from the report to show the House in authoritative terms what we have been contending ever since 1951. Perhaps some of my hon. Friends have sometimes been a little bored with my


insistence upon these financial matters. Peat, Marwick, Mitchell & Company say:
A fundamental difference between the two Accounts is that the Cash Accounts treat the Post Office as part of the Government
—and here is the important part of the sentence—
while the Commercial Accounts treat it as a separate entity, with the Government as a third party providing finance and hitherto raking the surplus.
All the profits the Post Office earned were taken by the Treasury. Peat, Marwick, Mitchell & Company state the position clearly and authoritatively.
Hon. Members should read the Memorandum issued in relation to the Money Resolution. It says, inter alia:
It is now proposed in the Commercial Accounts to plough back into the business the full sum provided for depreciation. This sum will be used to finance any capital expenditure. …
At last the Post Office has the right to use its own depreciation fund for its own capital development, and in so far as the right hon. Gentleman has won that battle with the Exchequer and the Treasury, I congratulate him. Millions of pounds of Post Office money has been involved in the past in this relationship with the Treasury. The right hon. Gentleman is on the right road, emphasise this to my hon. Friends the Members for Keighley (Mr. C. R. Hobson), Openshaw (Mr. W. R. Williams), Gateshead, West (Mr. Randall), and, in particular, the Member for Kilmarnock (Mr. Ross), who have assisted in the general fight to free the Post Office from the financial domination of the Treasury. Perhaps, Mr. Deputy-Speaker, you, too, will have a recollection of a very famous character in the House, the late Sir Herbert Williams, the one man who understood the mysteries of Post Office finance. It is time to salute Herbert Williams who, if he could look down upon us, would do so with a certain amount of amusement at this complete reversal of the traditional method of treating the Post Office.
The argument about the rate of depreciation and whether it should be primary cost or replacement cost, in so far as it affects the Treasury, loses much of its force. Whatever it is, the Post Office will keep it; that is the important thing. Nevertheless, it has a great deal to do with the charges imposed on the Post Office, because the higher the depreciation cost the greater must be the revenue

and the higher must be the charges. I remember that last July the right hon. Gentleman increased his charges not only to provide for increased wages but to provide a supplementary depreciation provision of £18 million. Obviously, if he had not had to do that, the charges which he then imposed could have been cut by half.
There is one other point to which I want to draw attention and on which I would welcome the right hon. Gentleman's consideration. Peat, Marwick, Mitchell & Company state:
Within these limits we have been instructed to make such comments as we think might be helpful.
What I would ask the right hon. Gentleman to do is to let the accountants look at the situation without limits. Let them examine completely the form of the accounts and make recommendations over the whole field, and let him then consider them. I refer him in particular to page 7 where they said that this raises the old question of whether the Post Office, which always pays its loan capital back over 20 years, should have a depreciation fund at all. They said that a depreciation fund is quite foreign to the method of financing Post Office development and foreign to the local authority concept. I make no declaration about this, but I should like it to be examined again. The right hon. Gentleman said that he would look at some of these matters again. Will he look at this? If all the capital has to be borrowed on a 20-years basis, that could turn out to be far cheaper than creating a depreciation fund. The right hon. Gentleman might be able to cut the charges very substantially. I am not saying that I have come to that conclusion.
There is one other point mentioned in Peat, Marwick, Mitchell & Company's report to which I should like to draw attention. The right hon. Gentleman has obviously read the report of the previous debates and he knows the argument about the difference between historic cost depreciation and replacement depreciation. But whether we have depreciation on a replacement basis or not, it throws up the other question which is mentioned in paragraph 22 on page 9 of the report. The report says that if the current assets were revalued, which is the parallel to replacement depreciation,
The Balance Sheet, if so remodelled"—


and they are talking about these accounts—
would throw up a substantial surplus.
I understood the right hon. Gentleman to comment that that is on capital account, but the size of the depreciation in the balance sheet is certainly related to the value of the assets. After all, it is the size of the depreciation charge which has to be taken into account in deciding the charges made to customers.
I leave the matter there and ask the right hon. Gentleman to consider the points which I have put forward, because I assure him that here I speak both for myself and for my hon. Friends. We have no objection to the Treasury acting as the banker to the Post Office but we object to the banker telling the client that the earned profits of the client belong to the banker and not to the client.
It has always amazed me that on this matter we have never had vehement protests from those engaged in the Post Office, since when they have asked the Postmaster-General for a piece of the cake which they have created, the Postmaster-General has said that he is sorry, but the Treasury has had the cake. The amount which remains with the Post Office is very often the factor which determines how mean or how generous the Postmaster-General can be towards his employees.
However, I hope that the Postmaster-General will continue on these lines, but I ask him to insert the operating profit in the presentation of the accounts. In the old form of accounts, for example, those issued last year, the operating profit was shown, but for some reason it has been omitted from this form of presentation. I ask the right hon. Gentleman to compare page 20 of the Post Office Commercial Accounts and Report with page 20 of the accounts for 1955–56. He will see that the real test of the efficiency of the Post Office is its operating profit.
I hope that in having paid the right hon. Gentleman some compliments I have atoned for the past. Perhaps I can associate myself with the firm in Caerphilly which wrote him that nice letter. However, Postmasters-General often get nice letters and they are not so exceptional that one has to quote them. I thought it was amusing that the Postmaster-General should have quoted only one letter. The

general experience of Postmasters-General is that they get very many letters of appreciation of the very valuable service rendered by the Post Office.

Mr. Marples: Not always from Caerphilly.

Mr. Ness Edwards: I agree, and not always from Wallasey. It will be very interesting to see what happens. I congratulate the right hon. Gentleman on his better pronunciation of "Caerphilly" It is improving with time.
I move to a subject on which I shall cease to be congratulatory and on which one has to be much more critical. The Government came to power on a promise to mend the hole in the purse, but, to use a colloquialism, they have not half put it across the Post Office public. Every year since 1951 we have had announcements of increased charges, and in some years we have had two such announcements.
One example is that of the residential telephone user for whom the telephone is a great social convenience. I have in mind farmers, old people, folk living in isolated places and children living away from sick parents. What have the Government done for them? In 1955, the rent was increased by £2 and from 1st October, this year it has been increased by another £3. The 100 free calls have been abolished, and on 1st January, 1956, call charges were increased by a quarter. That class of person has to find £6 or more to have a telephone installed.
That reminds me very much of the Budget statement of October, 1955, when the then Chancellor said:
The adjustments which my right hon. Friend is proposing"—
increasing the rent by £2—
will bring us nearer to a position in which the waiting list consists of persons who are prepared to pay the economic price for the service."—[OFFICIAL REPORT, 26th October, 1955; Vol. 545, c. 219.]
In other words, what the right hon. Gentleman was obviously doing was making a frontal attack on what has haunted all Postmasters-General since the war, the waiting list.
To make telephones too dear for ordinary folk was to attack the waiting list, but that came in a year when the trading profit of the telephone service was £15·6 million. Of course, the £2 increase did


not do the job, and it was only when the right hon. Gentleman became Postmaster-General that a blow was struck at the waiting list. The right hon. Gentleman went one step further. He increased rents by another £3, and by that produced the greatest contraction in the telephone system in the history of the Post Office. More than 100,000 people asked to have their telephones removed. What the story will be at the end of this year, when people get their bills for the previous six months with the increased charges which have operated since 1st October, is anybody's guess.

Mr. William Shepherd: Is the right hon. Gentleman telling the House that he believes that the Post Office should have continued to subsidise residential subscribers, or does he approve of the increase in prices?

Mr. Ness Edwards: If the hon. Member will allow me to make my speech in my own way, he will see what happened. The fact is that nearly every farmer in the country has his telephone subsidised, even with the present increased charges. Every person who lives in an out-of-the-way place has his letters subsidised by the people who live in heavily populated areas. The same principle applies to telegrams.

Mr. Shepherd: Does the right hon. Gentleman approve of residential subscribers as a class being subsidised at the rate of £3 or more per year? That is the simple question which I am asking him to answer.

Mr. Ness Edwards: I do believe it, because here is a fringe use of capital which is already invested. This is the Kingsley Wood outlook. Kingsley Wood said that one invested capital in cables, in telephone equipment, in all the switching gear inside all the exchanges, and that the main reason for doing that was to provide a service for the business user. That having been done, one came to the fringe user. If those costs are averaged, all the additional use by the residential subscriber becomes "bunce," even though the capital investment is still there to provide for the business subscriber. It is a fringe use, and in that sense the residential subscriber ought not to bear as full share of the burden as the person who uses a telephone as part of his business.
I spoke of the size of the charges which the right hon. Gentleman imposed in July. He said that he had to raise an extra £42 million of which eleven-twelfths was to meet wage awards which had been agreed or would be agreed. He was cheered for having had the courage to increase the charges, but it was obvious to me that some Post Office services were in danger of being priced out of the market, and I did not feel satisfied about the form in which those charges were to be made, nor was I satisfied that the charges were also to preserve a supplementary provision for depreciation of £18 million.
It is true that the right hon. Gentleman was very clever in the way in which he did it. He insisted that this was going to pay wages. For the first time, as it were, Post Office workers were to be treated properly. He was talking through his hat. The method of assessing Post Office wages has been for many years to follow the wages of similar work undertaken outside the Post Office. It is true that in 1955 a settlement on the subject of what was similar work was entrusted to a Commission, but that was in 1955. That Commission was to decide what were the rates outside for similar jobs inside the Post Office, and that was what the right hon. Gentleman was proposing to meet in the charges that he was making.
On 1st October, up went the charges, ostensibly to meet the wages. Then, of course, we had a change. During October there was a new wages policy. The Prime Minister made a speech about wages. The Chancellor of the Exchequer made a speech about wages. In the meantime, 100,000 people had left the telephone system. Then, on 13th November, we got the new announcement. The right hon. Gentleman hides it under automation, hut, in effect, he was announcing that he was abandoning £8 million of his revenue. Charges went up on 1st October, in the middle of November he abandoned £8 million of his revenue, and two days afterwards he refused to accede to a wage claim on the part of those people who had made automation possible. I think that all requires explanation. The right hon. Gentleman has not attempted to explain it.
The same people who cheered him for putting the charges up cheered him for putting them down. It reminds me very


much of a story that I heard of someone who had his watch and chain pinched. Eventually he got the chain back. People complained that he was not grateful. So he replied, "What about my watch?" The right hon. Gentleman puts the charge up by £13 million and then abandons £8 million of his revenue, all within a period of six weeks. All I can say is that that form of handling finances does not appeal to me as being the right way to handle the Post Office.
The right hon. Gentleman has talked a lot about automation. Let us get this in its proper perspective. Automation started with the first dialling system. It was done in this way. We first automised the local exchange by putting it on the dial system. We thus eliminated the operator straight way and we eliminated the manual recording of the calls. The next step was to group exchanges. That meant new exchanges, and it also meant central exchanges and new cables. That was the second step, and it is the second step which the right hon. Gentleman has announced. The third step is to link up the new group of exchanges with the trunk system and transform the trunk system into an automatic dialling system. Those are the three stages—the three stages which have been talked about for many years.
In fact, one of my predecessors, the right hon. Gentleman the Member for Dearne Valley (Mr. Wilfred Paling), making a speech on a money Bill, referred to the automatic dialling between London and Bristol. I know that the right hon. Gentleman has been talking about it, too. It is coming into operation at the end of next year. This talk about automation ought not to lead people from discussing what the right hon. Gentleman was really doing, which was to abandon £8 million of his revenue, which he had said previously he wanted to pay for wages. On the following day he said that he was not going to pay it for wages, and that Post Office workers would have to go to a wages tribunal.
The right hon. Gentleman brought out G.R.A.C.E.—group routing and charging equipment—but that was first mentioned by the right hon. Gentleman who occupies the Chair of this House, Mr. Speaker. At all events G.R.A.C.E. came forward. She was dusted, and was something new for

the Press to talk about instead of the accounts that really matter. I looked at the Press the day after the right hon. Gentleman made the announcement to see what would happen. More people were talking about G.R.A.C.E. than about the accounts. Only one unpretentious, provincial paper asked the right question. It was not one of the celebrated newspapers; it was a paper circulating in Wales. The commentator asked: "Why put up the charges in October to pull them down in November?"
I would put to the right hon. Gentleman three considerations. Was it necessary to put them up so high in October, even for the reasons which the right hon. Gentleman gave? If so, why did not he keep them up, or have the reasons for the increase changed? Are the wages not to be paid which are provided for in the increased charges? Has the amount which it was thought right to pay Post Office workers in July, and which the Postmaster-General flamboyantly boasted about, ceased to have any validity? The House voted the money to pay the wages, and yet the Postmaster-General told the workers—two sets of them—"You cannot have these wages."
Perhaps there is another consideration. Have the increased telephone charges been so catastrophic in relation to the telephone system that the right hon. Gentleman has had to give it a shot in the arm? These are the three considerations and perhaps the Assistant Postmaster-General will be able to deal with them.
I have some sympathy with one of the Post Office trade union officials who complained to me about what was happening. He said, "The Postmaster-General put the charges up to give wages, and the day before he meets us he gives away £8 million of the £38½ million he raises by new charges, and then says we cannot have the money." It was his belief that the Government had obtained a very large proportion of these charges under false pretences. Those are the things that I wanted to say generally about the Post Office accounts.
I would say to the Postmaster-General, particularly with regard to the outlook of the telephone system its aims and what should be done, that he is carrying on in true Post Office tradition. In other


words, he is following the road laid down by his predecessors on both sides of the House. There was unanimity in the view that the telephone system must be made completely automatic. I think that there we were both guilty of an omission when the right hon. Gentleman made his announcement about automation in this House. I failed to pay a compliment to Dollis Hill, and I am afraid he did, too. Anyhow we have made amends for it today, because the credit for automation, particularly in the London service, rests with Dollis Hill in the first place, with the Joint Committee, to which the right hon. Gentleman has referred, and with the electronics industry presided over by the Post Office. It is their work which is really making automation possible. On the other hand—do not let us be under any illusion about it—full automation of the Post Office telephone system is not due for a long time. It will require a lot of new exchanges, a lot of new cables and a lot of work. It will depend very largely not upon the capacity of the technicians but upon the amount of capital which the right hon. Gentleman will have at his disposal.
I saw the original machinery at Dollis Hill, as the right hon. Gentleman has probably done. Frankly, I cannot see a way out of the problem, but I think it is right to use the brains of people in any part of the world in order to solve this problem. When the right hon. Gentleman speaks of a new advisory committee, is he paying due regard to his present advisory committee? He already has a very responsible committee, and I should have thought that these matters ought to be put to that committee rather than that a new one should be created.
The right hon. Gentleman, as I have said, has not dealt with his Department's accounts in the course of his long speech. He has given us a rather gilded story of the possibilities of the future and of the objectives of the Post Office. One would have thought that his first obligation was to make clear to the House how he has handled the Post Office finances and justify the results of the expenditure. He should at least have ensured that the Post Office was not made to appear as being in the red to the tune of £3 million when, if he had applied the formula which has been applied since 1913 up to last

year, when the Post Office made a commercial surplus of £18 million, a similar surplus could have been shown.

5.42 p.m.

Brigadier Terence Clarke: I should like to ask the Postmaster-General one or two questions and to make one or two suggestions. Before doing either, however, I should like to congratulate him on his excellent speech in which he told us exactly what the Post Office will do in the future. I believe he is the first Postmaster-General I have known to make such an excellent statement to the House. Any derogatory remarks from the other side of the House are due purely to jealousy, in view of the failure of the party opposite to achieve similar success in the past.

Mr. Ness Edwards: I should make it quite plain that there is no jealousy on the part of any former Postmaster-General about any success which the Post Office may achieve, no matter who may be the Postmaster-General.

Brigadier Clarke: Naturally I would not accept that there was any jealousy on the part of Mr. Speaker, but it would seem unnatural to me to suggest that Postmasters-General are different from other people in that respect.
The Postmaster-General spoke of automation and told us that he intended to ask the public to assist the Post Office by saying whether the Post Office is giving them what they want. I should like to suggest a further development of the ordinary P.O. box system where visitors can collect their mail. That system could be further developed if people were asked to put their mail in a certain sized envelope. Perhaps they might even be allowed to post it for ½d. less than the ordinary love letters and less essential mail. My right hon. Friend might get a very ready response from such a scheme. Firms would be quite happy to collect their mail from certain accessible places and, no doubt, a considerable amount of work would be saved to the Post Office in delivering the mail. Moreover, firms would get their mail more often than they do now.
I believe the Postmaster-General could make telegram charges cheaper. I know that we lost over £1 million last year


on telegrams, and the previous Postmaster-General told me categorically that if he could price telegrams right out of the system, he would be very pleased because they were an expensive luxury which the Post Office did not like. Certainly by increasing the charges of telegrams we are making this an almost impossible form of communication.
I suggest that people should be allowed to send telegrams to a telephone number, thus requiring no delivery and it should be possible to do this much more cheaply than to send a man on a motorcycle to deliver telegrams. To send a telegram to an ordinary telephone number would cost the Post Office very little indeed and, therefore, it should be possible to allow this form of telegram to be sent much more cheaply.

Mr. W. R. Williams: Will the hon. and gallant Gentleman take it from me that it would not be any cheaper, because somebody would have to dictate the telegram to the telephone number just the same?

Brigadier Clarke: On the contrary, it would be a great deal cheaper, because at the moment when a telegram is dictated on the telephone it is followed by the delivery of the telegram for confirmation. If the local post office is aware that the addressee on a telegram has a telephone, the telegram is dictated and then the addressee is asked whether he wants the telegram sent to him for confirmation. I usually decline. I suggest that people who are already paying heavily for their telephones should have their telegrams sent more cheaply. If the Post Office would only think of reducing costs instead of continually increasing them, we might find that there were sufficient telegrams sent to enable the telegraph system to pay once again as it did in the past.
My final point is this. I may be told that I am out of order, although I understand that as we are voting money today for cables for the B.B.C., among other users, one is not out of order in asking the right hon. Gentleman to use his influence to bring the B.B.C. up to date. A lot of money is sent to the Post Office for this item.
I should like to refer in particular to the B.B.C.'s prejudices on certain subjects such as racing. Why the B.B.C. should

refuse, as it used, to give the names of horses which win races, beats me completely. I agree that in the last ten years or so the B.B.C. has done this, but we are never told the prices at which the horses win. Why should we be treated as children and not be allowed to know the price at which a horse wins?
When the B.B.C. is televising the animals walking round the ring, one is never given the prices, but I.T.A. does give this information. Why should one be allowed to do it and not the other? Is there a prejudiced person in the B.B.C. who thinks that he can tell us what we can do and what we cannot do?

Mr. Deputy-Speaker (Sir Charles MacAndrew): I agree with the comments, but they do not arise on this Bill.

Brigadier Clarke: Having got it off my chest, I apologise for being out of order, Mr. Deputy-Speaker. I hope the Postmaster-General will not forget what I have said.

5.48 p.m.

Mr. William Ross: While the Postmaster-General was making his excellent speech—I hope he will take that as a compliment, for although it was long, I think most of us enjoyed it—there were occasions when I thought he should have spent a little more time dealing with the actual Bill and the accounts of the Post Office. Apart from that, I would say that the subject matter is of considerable interest to everyone.
I had occasion to interrupt the right hon. Gentleman and he rather knocked me down by telling me that I was eternally impatient. I have been a member of the Post Office Advisory Council for nearly ten years. I do not know for how long the right hon. Gentleman has been Postmaster-General, but I have sat under at least six Postmasters-General. When I hear the Postmaster-General delivering what has become more or less a "Marples story," in which he describes how he has considered a problem and, after consultation with his business friends, has decided that something should be done, I recollect those years of discussion on the Advisory Council.
When the right hon. Gentleman speaks of some machine that will bring an aspect of the Post Office up to date, I recollect that that machine was perfected by his


own engineers and that it had had its field trials and had been proved successful before the right hon. Gentleman became Postmaster-General. I thought it was a little unfair of the right hon. Gentleman to delay his references to the work of his predecessors and of the engineers who have been dealing with these problems for such a long time. I hope to come back to one or two of his points later.
First of all, I regret very much that there has been so much knocking of the Post Office during the past year. Although the Postmaster-General may fail to talk about it enough, there is no doubt at all that the Post Office took a terrible knock, and confidence was very much undermined, certainly among those who felt that the last thing they were prepared to give up was the telephone, when he raised the rental charges and other charges as he did during the year. I should like to have up-to-date figures about it. What is the position as regards subscribers now? Have we a waiting list at all?

Mr. Marples: Mr. Marples indicated assent.

Mr. Ross: I wish we could have been told.

Mr. Marples: I do not want to be discourteous to the House, but it is very difficult to make a comprehensive speech. Whatever one does, one is bound to miss something out.

Mr. Ross: Surely, the right hon. Gentleman will agree that one of the most important things which happened in relation to the Post Office during the year was the increased charges, and the reaction of the public is something we want to know about. A tremendous number of people gave up the telephone. It is all very well to talk about new kinds of equipment which will make the telephone more readily available to everyone, but in the first place we must not only obtain but keep our subscribers.
The Post Office needs once again to be in a position where it is free to sell the telephone to people. We shall be able to do that only if the terms are reasonable. I am quite sure that no one, looking at the position today, even with the changes the right hon. Gentleman has announced in connection with the area call, will see much prospect of being able to bring back all those private subscribers

who gave up the telephone. The truth is that the residential subscriber dials within his own area; he seldom dials outside. This is one of the facts that the right hon. Gentleman pointed out. The most uneconomic factor in the telephone system is the residential subscriber who pays his rent and uses the telephone probably very little beyond what was the old free call. There is little doubt about that. It is, therefore, of no great advantage to the residential subscriber to be given a wider area over which to call. That in itself will not bring back many of our lost subscribers.
What we must do is to make it possible eventually to lower the rental. There can be no doubt that we must face that as one of our problems in the future, having in mind the question whether the number of people taking the telephone will justify our carrying on with our schemes. I sincerely hope that we shall receive a response from the public in that.
My right hon. Friend the Member for Caerphilly (Mr. Ness Edwards) a former Postmaster-General, said that we had won some battles. I should not be too sure about the battle with the Treasury, and I am perfectly certain that the Postmaster-General himself would not accept that the battle has been won. The arrangement we have is to last only five years. Although the Post Office has a certain capital reserve, it is not a very big one at the moment; it is building it up. I think it consists only of the formerly built up supplementary depreciation payment coming to about £18 million, and the amount this year which will bring it up to about £34 million.
If the Post Office wants to draw on that capital reserve, is there no control? I am perfectly sure that there is still general Treasury control over the capital investment of the Post Office just as there is on everyone else.
The right hon. Gentleman himself said that he was concerned to do all he could to build up co-operation between the Government undertaking, the Post Office—I prefer to call it the nationalised undertaking—and private enterprises having manufacturing interests and selling interests both at home and abroad in respect of telecommunications equipment. He wants to do all he can to help. It is


vital to those manufacturing interests that he really should win the battle.
I should like to read something from the annual report of the Telecommunication Engineering and Manufacturing Association:
Since telecommunications are operated by the State, they are always an easy target for a Chancellor of the Exchequer who wishes to put the brake on capital investment, and, although the Post Office bought more equipment last year, their estimates were, as previously reported, cut to the extent of £5 million by the Treasury, in spite of the very considerable number of people waiting for a telephone to be provided.
The Association did not regard it as a very happy augury for the new arrangements in relation to finance that, in the first year, there should be such a cut. I think representatives of the Association made their attitude perfectly clear when they met, if not the right hon. Gentleman himself, certainly his predecessor, the right hon. Gentleman who is now getting a bit mixed up with the Press and public relations. It is plain that we must still battle on. The Post Office must be given more freedom if we are to attain the objects the right hon. Gentleman has outlined today, and we cannot do it with the type of Treasury control which we have now.
I must confess that I am not very happy with the new accounts. I knew my way around the old ones and could spot all the things I wanted, but I have found a little difficulty with these. That is why I regret that the right hon. Gentleman did not spend more time on them.
I feel that we must underline the changes which have been made in relation to the £5 million which must be paid to the Treasury and the changed policy in relation to the calculation of depreciation which has led inevitably to showing the Post Office as having a deficit of £3 million. I made one or two calculations about it. We are paying additionally to the Treasury this year about £2·7 million, and £15·7 million additionally for depreciation. If those sums of about £18 million had been added in we can see that, from these two calculations alone, there would certainly have been a considerable surplus.
We are paying the whole depreciation. Depreciation was about £45 million. That is all going as cash to the Treasury,

without anything necessarily coming out, because, as far as I can see, anything coming out is coming out through advance of capital on which the Post Office is being charged currently about 5 per cent. That is the figure in the Report, and it may be higher by now. Increased interest charges last year represent one of the factors leading to the deficit even within this form of accounts.
I notice that there is stress once or twice in these accounts upon the fact that the Post Office has to be debited in respect of interest charges in relation to its liabilities to the Treasury, but I have not seen any report as to what the Treasury credits to the Post Office.

The Assistant Postmaster-General (Mr. Kenneth Thompson): It is in there.

Mr. Ross: I hope that the hon. Gentleman will be able to give me the actual information. These things are of considerable importance in getting a dearer picture, but we do not get as clear a picture from the new form of accounts as we did from the old.
One thing which I regretted the right hon. Gentleman said was that in relation to Post Office work—I presume he was referring to the sorting of letters and the rest—we had made no advance and methods were still the same as they were 100 years ago.

Mr. Marples: Basically.

Mr. Ross: The conveyors, the separators and the parcel sorting machines were never even dreamed of 100 years ago. Is it a matter of policy for the right hon. Gentleman to take an unrealistically gloomy picture and then to tell us what is to be done, knowing that it has been done for quite a long time, so that he can say, "Look what a clean, brilliant new sweep we have made"? That is not good enough.
Over the course of the 100 years, a gradual process of mechanisation has gone on steadily. If there has been any intensification of it, it was done about two years ago, when increased priority for mechanisation was given by the establishment of the Mechanical Aids Committee within the Post Office itself. It is from that source that we have had the speeding-up. It really should not be suggested to us that the electronic sorting


machine and the other items are something new which have been thought out overnight.
I, too, pay my tribute. In referring to the advances which have made us the most up-to-date country in the handling of mails, I do not understand how it can be said that we are doing the same things as we did 100 years ago. The fact that we are in this proud position now is due to Dollis Hill and to the devotion and dedication of the men who work there. Throughout the Post Office, all ranks—the men we see and those we do not see, the postmen, the people behind the counter and those in the engineering research units—are dedicated to their own establishment and to the Post Office, which possesses its proud history mainly because that spirit exists and has been fostered.
I want to pay a tribute also to the Minister. I think he has done his share in fostering that spirit, and we want to make sure that he continues to foster it along those lines; but we must watch him in case he begins to regard it as Marples' Post Office instead of the General Post Office. I am wondering whether or not some of the advances we have made are due to the fact that Sir Gordon Radley is the first engineering Director-General we have had. Certainly, we have in him the kind of mind that is needed for the task ahead. There is no doubt that we must keep ahead in these various ways.
The Postmaster-General said that a business committee was to be appointed to advise him on what the public wants and how the Post Office should develop. Does this mean that he is scrapping the Post Office Advisory Committee, on which, as he knows, there are business men from different parts of the country? I wish the right hon. Gentleman had said more about the scope and nature of the new committee. There are already in the Advisory Committee men of considerable experience, whose interests in the Post Office are of much longer standing than mine. In setting up his new committee, the right hon. Gentleman need not imagine that his action will not reflect itself on the existing committee and in the eyes of the public. I hope we shall get some clarification from him.
The right hon. Gentleman had something to say about Scotland. Incidentally,

if he wants to do anything for Kilmarnock, could we have a few more—I do not mind whether they are the elaborate now ones or what he has left over of the old ones—telephone kiosks on the Onthank and Bellfield areas of Kilmarnock's new housing scheme? If he does not know how to spell the names of these places, I will be glad to provide the information.
The right hon. Gentleman was not very happy today in his references to Scotland. He said that we came from places with names that were difficult to understand. I am very glad, Sir Charles, that you were not occupying the Chair at the time, for I am sure that you, like me, would have been enraged. Surely, the right hon. Gentleman is not complaining about the word "Kilmarnock". He probably sees it on every Johnny Walker whisky bottle which he notices in the shops.
It was bad enough for the right hon. Gentleman to make that comment, but he then said that our handwriting was very bad. Educationalists in Scotland have always prided themselves on the quality of our handwriting. It was unfair of the right hon. Gentleman to say it, even if he did so jokingly.

Mr. Marples: I said that it was difficult for a foreigner to decipher.

Mr. Ross: If that is the outlook of the Postmaster-General, it explains a great deal.
There has been considerable controversy over the action of the Postmaster-General concerning a request from Scotland which we regard as highly important. I was born in the town of Ayr. I represent Kilmarnock. Just as in Ayr was born Scotland's national bard, Robert Burns, I represent Kilmarnock, where the first copies of Burns' poetry saw the light. On 25th January, 1959, we shall have the two-hundredth anniversary of the birth of Robert Burns.
I do not know whether the right hon. Gentleman sincerely understands or appreciates what Robert Burns means to Scotland, and, indeed, to Scotsmen all over the world and to people in those parts of the world with whom they have come in contact. He has been asked by the Burns Federation to consider the possibility of issuing commemorative postage stamps in January, 1959. He has not been at all sympathetic and has brushed


the idea aside. Indeed, on the last occasion that a telegram was sent to him about it, I was shocked at his answer. He said:
Kenneth Thompson's letter must be regarded as final. No useful purpose would be served by such a meeting.
He had been asked to meet a delegation. What would he lose by doing so? He would have the chance to explain exactly what difficulties exist, if difficulties there are, and how insurmountable they are. He could give an explanation to these intelligent Scots—and not only to Scots; some of the members of the Burns Federation are English. The appeal of Burns goes far beyond Scotland.
I understand that it was suggested that if this proposal relating to Burns were to be allowed, the Post Office would need to consider, in the language of the former Postmaster-General, other illustrious people. Scots would say that there are not very many people who are quite so illustrious. But even if there are, and we are prepared to admit it, there would not be a two-hundredth anniversary of their birth every week, and the same thing should be done in their case.
The precedent was broken by the right hon. Gentleman's predecessor. I have said that it having been breached once it should be breached again, and that this was one of the occasions on which Scots would insist that due regard should be given to their rights by issuing postage stamps to commemorate the birth of Robert Burns. I represent in this House, among other people, Lord Rowallan, the Chief Scout, whom I am to meet either tomorrow or the next day about another matter. I do not deny the worthiness of the Scout movement and the great good that it has done in the world, but I would emphasise the good that has been done by Robert Burns and his poetry. His passion for humanity and his proclamation of the Brotherhood of Man have been a powerful force for peace throughout the world.
I feel that the Postmaster-General has not properly understood, and certainly has not shown any sympathy for what exactly this means not only to the people of Scotland but to people throughout the world. On 25th January, 1959, there will be celebrations by many people in a hundred languages and they will sing

a song that the right hon. Gentleman has sung. I wonder whether he knows that Robert Burns wrote "Auld Lang Syne", the song of brotherhood that is sung all over the world.
I sincerely hope that the right hon. Gentleman will remember that precedents have been broken and that difficulties can be surmounted. It is far better to commemorate rather than battles and castles the man who is held in high esteem all over the living world. World-wide celebrations will be held and the focal point will be in Scotland in 1959. The least that the British Government can do is to arrange that a commemorative stamp should be issued. I ask now whether the right hon. Gentleman will be prepared to meet a delegation of Scottish Members of Parliament to discuss this matter, because I cannot take it that a letter written by the Assistant Postmaster-General shall be regarded as final while there are still people who call themselves Scots and Scottish Members in the House.
To those who are hesitant about this I would quote the words of Robert Burns himself. He said:
In gathering votes ye werna slack,
Now stand as tightly on your tack.
Don't claw your lug
And fidge your back
And hum and haw,
But stand up straight and gie your crack
Before them a'.
It means, "All right, do not say one thing in Scotland and do another thing here." I hope that Scottish Members will insist that the Postmaster-General looks at this matter again. I am perfectly sure that this proposal can be carried out.

6.15 p.m.

Mr. William Shepherd: I do not intend to be drawn into discussions about the place which Robert Burns occupies in the world of poetry. I am sure the Postmaster-General will deal with that in his own way. I am surprised that there is so little interest in the affairs of the Post Office today. It must be a source of regret to my right hon. Friend and to many other people.
It is surprising that there is not a greater interest, because usually shareholders—and after all we are the shareholders' representatives in this connection—turn up when things are not so good. We have been told that price increases in the last twelve months have been very


disagreeable, and I should have thought that there would have been evinced a much greater interest in the proceedings today.
However that may be, we had from the Postmaster-General a most interesting speech in which he gave us a glimpse of the technically progressive side of Post Office activity. Some hon. and right hon. Members opposite are perhaps a little critical that my right hon. Friend is too publicity-conscious, and the direction in which some of the credit has gone may perhaps be a little galling to them. The Post Office has been a flower that has bloomed unseen, and a great deal of the work done by Dollis Hill has been unknown to the vast majority of people. I hope that right hon. Members opposite will swallow what personal advantage my right hon. Friend may gain in realising that if lie succeeds in putting over the Post Office as one of his predecessors, Sir Kingsley Wood did, he will be doing something of immense benefit to those who work in the Post Office.
I have one word of criticism of my right hon. Friend's speech. I know that it occurred accidentally, but I felt that in emphasising the technical and technological side of the work perhaps my right hon. Friend did not pay sufficient tribute to the men and women who work for the Post Office. However much we may increase the supply of mechanical devices, this great business will depend upon the loyalty and devotion of those who work for it. I am sure that my right hon. Friend agrees.

Mr. Marples: I am most grateful to my hon. Friend for mentioning that. Although I took a long time to speak, I jettisoned what were to have been the concluding passages of my speech because many of my hon. Friends were saying that I had been too long. I want to make it as clear now, as I did in the Press conference on Post Office charges, that the staff has worked very hard these last twelve months. It has given devoted and loyal service, with an immense skill and patience and assiduity, which to me has equalled anything I have experienced in private enterprise or elsewhere. I failed to say this in my speech only because several hon. Friends were hastening me on.

Mr. Shepherd: I understand my right hon. Friend not saying everything because I, too, was wondering when he was coming to an end.
I congratulate my right hon. Friend upon securing some sort of change in the arrangements for capital and depreciation. The battle with the Treasury has been a long one, and, in the main, it has been lost in the past. I congratulate him on winning at least one stage of the victory. Anything that makes the Post Office commercial accounts less uncommercial is to be welcomed. It is also important that the Post Office should obtain a much higher reserve than it has at present. It is quite absurd that a business of this size has existed all these years with no real reserve. It should be carrying a much more substantial reserve, and I hope that in the next ten years that will be achieved.
My approval of the change in the method of accounting is not limited merely to approval of the benefit which will come to the Post Office. It is most important to get this relationship of Government enterprises and the Treasury correct. I feel that as time goes on we shall find that many nationalised industries now being put out as trading corporations will have to be brought under a better form of Parliamentary control. One of the difficulties of doing that has been the relationship between the Treasury and a Department like the Post Office. Any change of a progressive character that we make which will eliminate these difficulties will pave the way for more effective control of nationalised industries in the future.
On the vexed issue of telephone charges, I had occasion to interrupt the right hon. Member for Caerphilly (Mr. Ness Edwards). There seems to be an extraordinary amount of woolly thinking about them. When I interrupted the right hon. Gentleman and asked whether he supported a subsidy to residential subscribers, he said, in effect, "It is only a marginal, fringe activity of the telephone service". This is not true. The residential subscribers on the Post Office substantially outnumber the business subscribers. There are about 2·6 million against 1·8 million.
I cannot see why the Post Office should for any reason whatever be compelled to provide residential subscribers with


telephones at lower than cost. If we were concerned only with the Post Office we should think that, but if we are concerned with the wider aspect of the effect on the economy our reasons are doubled. Why should we devote capital resources, which are scarce, to providing additional cables and equipment to give people telephones at lower than cost to us? We are merely diverting capital resources from what might be profitable export outlets to give people in residential areas telephones at less than cost.
I should like to have a telephone at less than cost as a resident, and all my constituents would, too, but it is proper that in viewing the nationalised industries of this country we do not try to make a party point out of these things. We ought to recognise that the duty of the Post Office is to provide telephones at the lowest conceivable cost to every class of subscriber but to realise that the Post Office has no duty at all to subsidise any subscriber of the telephone service.
I want to say a word about the attitude towards the Post Office, because there is much of what I might term an unfortunate attitude towards it in this country, largely because some individuals cannot see any good at all in a public service. Some people, of course, cannot see anything bad in a public service. I think we ought to end this blind approach and take an adult approach to the question of public services and nationalised industries. I do not for a moment deny that the Post Office is a very fine organisation and that it does an extremely good job, but that in no way detracts from the fact that I think that by and large the greater part of the activities of this country, economically and industrially, ought to be run privately. The reason is that I recognise that the Post Office is an organisation which is particularly suited to nationalisation. It is a business which depends upon system; it depends upon everybody carrying out their jobs in a systematic manner. It benefits from a highly intelligent centralised control, but many other forms of business activity die on that diet. While I praise the Post Office, therefore, it is not because I believe that nationalisation is a superior form of organisation generally, but because I believe that nationalisation is particularly suited to this kind of activity.
In the interests of the staff, we ought not to indulge in such petty and in many cases wholly unjustified criticism. On occasion, I have had to say one or two things about the Post Office and its staff in a complimentary way, and I have been much impressed by the way in which that has been received by the staff. The morale of the Post Office is its greatest asset. Without its morale it would cease to be the efficient organisation that it is. While I shall criticise the Post Office in a minute, and while I do not believe that criticism ought to be silenced, it ought to be responsible, and it certainly ought not to be malicious.
The Postmaster-General stressed the need for mechanisation in postal delivery, and I hope that he will get somewhere with this. I say that in a qualified way, because there are many hurdles to overcome before we reach the state of affairs where the magic eye can do this work. On the whole, people in this country like to be individualist. It is one of the major differences between this country and the United States We do not accept standardisation. We think that standardisation in the things that we do or wear is unnecessarily limiting, but in America there is a very ready acceptance of standardisation. I have very considerable doubt whether we shall get the public acceptance of the standardised envelopes and coded addresses. I hope that we shall, but I have very great doubts.

Mr. C. R. Hobson: In all fairness, the point ought to be made that we have a far more efficient postal service than America and that we are more mechanised than the Americans, even without standardisation.

Mr. Shepherd: Indeed we are, but we are coing to an era in the postal service where we are to consider the prospects of mechanised sorting, and I was suggesting that on the whole the Americans have a better chance of getting the standardardised envelope and the coded addresses accepted than we have because we are much more individualistic as a nation. Nevertheless, I reinforce what my right hon. Friend said. People must face the realities of present-day costs if they want to refuse to conform to the new ideas. In this country we have had a number of services like rent, postal communications and coal placed at our disposal at absurdly low prices for a very long time,


and it is hard for a great number of people to realise that that era has passed and that we are entering into an era of relatively high costs in respect of a number of things, in the same way as happened in America a long time ago. As my right hon. Friend said, people will have to decide that if they want their individualistic approach they must pay for it.
May I touch on one or two things about the postal service? On the whole, we have a good postal service, but I am disturbed about the extent to which we have labour turnover in the postal service. This is a serious drain on the efficiency of the service, because knowledge of a particular walk is of especial importance to postmen. I hope that the new rates of pay which are being introduced will reduce the amount of labour turnover in the Post Office. Here I enter a word of criticism—I hope that we shall get smarter postmen than we have. There are far too many slovenly postmen about today. I am not saying that every postman who walks about is slovenly; of course, that is not the case. The majority of postmen are smart. But it is bad for a service to have an untidy man walking about in a uniform or what one guesses to be a uniform. Sometimes one is not quite sure what it is. I hope that those in the unions who are responsible will try to get their members to realise that if they are a public service and want to stand high in public esteem, part of that pattern is, when they appear in public, to be smart and to keep themselves looking neat and tidy.

Mr. W. R. Williams: I am interested in what the hon. Member has said. One of the complaints of postmen throughout my long experience has been that, in order to be smart, they would like to have the best form of uniform and a replacement of that uniform in order to retain that smartness. I am satisfied that if the hon. Member is able to convince his right hon. Friend that a more frequent issue of uniform would help towards that smartness, the postmen would be the first to accept it.

Mr. Shepherd: I have no doubt that with a more liberal distribution of uniforms the postmen might look much smarter, but there is such a thing as care and preservation of uniforms, wearing a cap and buttoning up the jacket. I am

saying that in many cases—I do not say anything like a predominant number—the postman is not a good ambassador for the business because he does not keep himself as smart as he could, even with the limitations of the present issue of uniform.
What does my right hon. Friend intend to do about these wretched letter boxes which people are putting at the bottom of doors? In times of labour scarcity there is no point in delivering letters to people who will put their letter box at the bottom of the door. If everybody had their letter box at the bottom of the door there would be a much larger labour turnover in the Post Office than there is now. Certainly there will be much higher cost in delivery. My right hon. Friend said that he was inviting various bodies to devise the ideal letter box. I am not so much concerned about the ideal letter box as the position it occupies in relation to the building. It is grossly unfair to expect postmen who have to carry a fairly substantial load at the start of their walk to bend down and put letters into letter boxes at ground level.
Another point of minor importance I wish to speak about is the postal orders which have been issued. The present postal order is really a frightful mistake. In fact, when I first saw it I thought it was a misprint and the machine had not quite got the colour of the ink on to the paper. It looks a washed-out affair. The type faces are all jumbled up in an unreadable mass. If the old postal order had been bad I would not have grumbled so much. But the old postal order was of sounder design and a well printed and well produced piece of paper.
The new postal order in no way compares with the old from the design aspect. In an organisation like the Post Office we expect to see progress. I think that every massed-produced paper in the Post Office is important to prestige. I hope that the Postmaster-General will put out to one or two designers the chance of designing a new postal order with elegant type faces which is easily readable and well printed. I know that it can be done, and I hope that it will not be long before the present postal order is superseded.
I should like to say how much I think the counter staff in post offices has improved in the last decade or so. When I was a boy I was afraid to go into a


post office and face those monsters behind the grill, particularly the female monsters. I was very glad that the grill was there in case I was bitten. Today that has changed. A genius decided to mix some men with the ladies. That seems to have had a quite remarkable effect. This matter is important. I am certain that a large number of people took their pattern of the average civil servant from those rather fearsome ladies who sat behind post office counters. Today, I am sure that a lot of people realise that a change has come about and that on the whole the Civil Service has benefited from the improved relations between the counter staff in post offices and the public. I for one am grateful for the great improvement which has taken place in the last decade or so.
In conclusion, the progress that the Post Office is now making has to continue because, as we all know, applied science is the key to modern industry. No less than any other organisation can the Post Office refuse to play its part and take advantage of applied science. There is great scope for it in the Post Office. I hope that the progress will be pushed on as hard as possible. I am convinced that my right hon. Friend will do it if anyone can.
Whatever we do to improve the mechanical set-up of the Post Office by applied science, it will always remain a business which rests much upon the men who serve it. There is a great deal of attraction and prestige in the words "Royal Mail". Men in the Post Office do not go to work; they go on duty. That service to the community is something which is of great value to us as a nation. It has enabled us to have the best and the cheapest postal service in the world. It is due, in the main, as my right hon. Friend said not to any mechanical marvels, but to the sense of duty of those who serve the Post Office. I hope that in the future those who want to criticise these men—and they must be open to criticism—will realise that, although it may have its shortcomings and costs may be rising, we still have the cheapest and best postal service in the world.

6.35 p.m.

Mr. Emrys Hughes: I will not detain the House more than a few moments. I intervene in this debate

only because I wish to endorse the remarks of my hon. Friend the Member for Kilmarnock (Mr. Ross). He appealed to the Postmaster-General to think again about the possibility of issuing a Burns stamp in 1959. I am not sure he realises the very strong public opinion there is about this matter, not only in Scotland but by Scots everywhere.
My hon. Friend was not making merely a parochial or constituency point. He was putting a point of view which is widespread and which, I believe, is prevalent on the benches opposite. I am sure that if he consulted the Secretary of State for Scotland, who, together with the Prime Minister, knows something about the opinion that prevails in this matter, he would realise that this is not an ordinary request.
I submit to the Postmaster-General that there is a precedent. In August this year those of us who were at the Inter-Parliamentary Union Conference in London had the opportunity of buying the special stamp which commemorated the Conference. If a special stamp is issued for the Inter-Parliamentary Union, I suggest that a precedent has definitely been created. While we all agree that the Inter-Parliamentary Union is an international organisation, it is also true that the celebration of the Burns bicentenary will also be a great international celebration as well. I know, for example, that delegates are coming from all parts of the Commonwealth and from many other countries, including the Soviet Union. Why should it be that the Soviet Union has a Robert Burns stamp yet the country of his origin has no Burns stamp at all?
The Minister shows great imagination in many of his administrative actions, and I believe that he is open to conviction on this matter. He has plenty of time to think about it during the next year. I ask him to respond not only to Scottish opinion but to national public opinion and international public opinion, too. Thousands of people will be coming from all parts of the world to Scotland and London in connection with the celebrations. It would be an act of commonsense and an act of imagination and enterprise to publish a Robert Burns stamp to mark this unique occasion.

6.39 p.m.

Mr. C. R. Hobson: I, too, am surprised at the sparse attendance for a debate upon this Bill, which involves the granting of a considerable amount of money. One can only put it down to the fact that it is an exceptionally foggy day.
This debate provides an opportunity for us to review the whole work of the Post Office. Normally, we have these money Bills every two years, but the Postmaster-General stated that that was not going to be the practice in future. I gather that we are going to have this kind of Bill as and when the money is required. Previously the custom has been to ask for a sum of £175 million, whereas the Bill asks only for £75 million, for reasons which the right hon. Gentleman has given. I should like to know whether the £75 million will last for the normal two years.
The Opposition have not been able to have a Supply Day for a debate on the Post Office. We have had the usual twenty-six days, but such are the sins of omission and commission of Her Majesty's Government that we have had to choose far more important matters than the Post Office, which is an efficient and prosperous business concern. Here we are concerned with a Department with a capital of £1,000 million and a staff of 360,000. It is therefore our duty to review the undertaking very carefully.
I pay tribute to the commercial buoyancy of the Post Office. It amazes me how, when the traffic continues to grow, the Post Office is able to absorb millions of pounds in increased wages and transport costs without having to increase its charges. It is only this year that we have had an increase in what I always call the basic postal rate, front 2½d. to 3d. This is only a 100 per cent. increased over the pre-war rate, and there are very few commodities whose prices have not been increased to a greater extent. I am amazed at the criticism the increase has received in the Press. The price of newspapers has risen by 150 per cent., compared with the Post Office increase of 100 per cent. in its basic charge.
I should like to have the breakdown for wages and extra costs in the Post Office from 1945 to the present day, or to the nearest available date. The relevant

figures must be available. The reason for the increased charge has been the increase in wages and the Post Office workers were certainly entitled to an increase. The trade unions would have been failing in their duty if they had not applied for it. Taking the normal yardstick, and comparing the wages of Post Officer workers with those of the average worker before the war, and before the latest increase, one finds that the Post Office workers certainly deserve the rise.
I should like to know something more about the outstanding application of the Post Office Engineering Union. When the right hon. Gentleman informed the House of the increased charges I asked him whether they included a settlement of the claim of the Post Office engineers, and, if my memory serves me right, his answer was in the affirmative. Apparently, however, the claim has not been settled. I do not know whether it is because of a disagreement about the figure, but the matter is now to go to an arbitration tribunal, whereas the right hon. Gentleman led us to believe that it had been settled—as he will see if he refers to his reply.
We should do well to remember the normal practice and the normal machinery which exists for seeking wage increase in Civil Service unions, namely, the machinery of the Whitley Councils. The validity of a claim is continually examined by expert witnesses at the arbitration tribunal. For ordinary commodities shopkeepers can raise their prices almost as they wish, as can businesses, but when wages are involved a very complicated procedure has to be followed. The Post Office claims have managed to survive this test, and the men and women in the service have received the increases to which they were entitled.
Many tributes have been paid to the Post Office staff. I pay tribute to their rational approach to the introduction of automation. There is no Luddite attitude towards new developments. That is true in the case of the mechanisation of trunk switching and through-switching in telegraphs. There is a progressive attitude to these matters.
In addition, a tremendous amount of work is put upon the staff. Who would like to be a counter clerk? If there is any extra work which affects the whole of the population, the Government always give it to the Post Office, and the grade


that usually has to carry it out is the counter clerk. I have hurriedly scribbled out a few jobs that he has to do. He has to deal with stamps, postal orders, money orders, pensions, savings bank transactions and dog licences, and he must know the multifarious rates which exist for letters, printed packets and parcels. He also has to deal with telegrams and, last but not least, Premium Bonds. I never cease to admire the work done by the counter clerk.
It is my duty to ask the Postmaster-General a number of questions, and I will deal first with the postal side. What is the attitude of the Department to the many requests which have been made by small organisations, including people who are just beginning to promote companies, who seek to carry out their own deliveries, or to negotiate arrangements with the Post Office for the bulk delivery of letters at a lower rate if they are sent to the Post Office at a certain time? A decision must be taken on this matter, because many more applications will be made.
Secondly, what is the Department's attitude to the bulk postage of printed matter from abroad to this country? Many firms are having matter printed and posted abroad where the rate is often subsidised by the Government concerned. This means a loss of revenue to the British Post Office on matter which should have been printed and posted in Britain. There is an increasing tendency to print matter abroad, but I believe that it can be prevented under existing Post Office regulations. A decision must also be taken on that matter. I do not know how many foreign countries subsidise printed matter in this way, but I think that many do, and I know that Holland does.
Reference has been made to buildings. Post Office buildings in many areas still leave a lot to be desired. Some should be entirely scrapped and new ones built. Whitehaven is a very bad example. I hope that steps are being taken to build new ones. I should also like to know the present position about the new West Central Office. How is that scheme going on? Then there is the extension of the Post Office underground railway. I happened to be Chairman of the Committee

which considered the hybrid Bill in connection with that matter.
The retaining of staff in these days of full employment does not depend solely upon wages. There is shift work in the Post Office, and, as an old shift worker, I know how onerous it can be. Welfare also enters into the matter. It is very difficult to provide satisfactory welfare conditions in old and obsolete buildings, and so I hope some attention will be given to them.
I intended to speak about mechanisation but as the Postmaster-General has given us a very up-to-date survey of what has been attempted in that field I propose to say no more on that subject, except to wish the scheme well and success to the contemplated developments.
The engineering section of the Post Office is vast and complicated. The telephone repair service is very efficient and continues to improve. Many people do not appreciate the speed with which repairs are carried out, not only small ones at home but major ones which result in many cases from the weather. What is the position about new buildings and new telephone exchanges? There has obviously to be a change of design because of the contemplated new scheme. One of the difficulties that we experienced in meeting the requests of people to be connected to the telephone was that one in five of the existing exchanges were so full that it was impossible to put more equipment into them.
The added difficulty which the right hon. Gentleman has to face results from the first action taken by the present Home Secretary when he was Chancellor of the Exchequer in 1951, which was to cut building. The Post Office had to carry the knock, too. Apart from the difficulties remaining from the war years, there is increasing difficulty because of that action of the former Chancellor of the Exchequer.
Let us look at two weaknesses which still continue in the telephone service. The hon. Baronet the Member for Dorset, South (Viscount Hinchingbrooke), who is not here at the moment, has frequently raised one of them, and I have raised it by way of Question and answer but have never got very far. It is a difficulty which the Post Office had when I was there, and it includes


the speed of answering phonograms. Something must be done to improve it. There is delay at peak load in dealing with directory inquiries, and I can well understand it, but I cannot understand the delay that occurs outside business hours, I hope that the right hon. Gentleman will look into these matters.
My hon. Friend the Member for Manchester, Openshaw (Mr. W. R. Williams) said that he welcomed any reduction in telephone charges. It would be churlish of me to do otherwise, but I wonder whether the reductions have been made in the best way. There is obviously a theoretical saving as the result of automation, but even the Department cannot be quite sure about it. If there is, it will grow greater. How shall we apply it? That is a reasonable question.
The right hon. Gentleman has enlarged the radius of the ordinary call, and in London this abolishes the toll call and reduces the trunk charges. I wonder whether that was the best way. There is a reason for debate and difference of opinion on this point. I should have thought we could have helped the residential subscriber, despite what the hon. Member for Cheadle (Mr. Shepherd) has said. The residential subscriber has been clouted on the head and slapped on both cheeks. First, he has had his rental put up; secondly, his free calls have been abolished; thirdly, his call rate has been increased. He really has suffered. I may be told that the residential service is not an economic proposition but that is true of other services of the Post Office. I would have felt inclined to apply whatever surplus there might be for the benefit of a residential subscriber.
Figures have been worked out by the gentlemen of the Press. I put one of them to the test myself. The average number of calls which the ordinary residential subscriber makes works out at pretty nearly 1s. a call, now that the free calls have been abolished, whereas he can go to a call box and make a call for 4d. I believe that many former subscribers are doing so. My hon. Friend the Member for Kilmarnock (Mr. Ross) said that one of the reasons for the falling off in the waiting list was the high cost of the residential telephone. It is probably too late for the right hon.

Gentleman to change anything, even if I could convince him in argument, but if there is a surplus on the telephone side for distribution I hope he will not forget the residential subscriber.
I enjoyed the right hon. Gentleman's fun about Keighley. The only thing I have against him is that he started to compare Lancashire with Yorkshire. I do not intend to fight the Battle of the Roses again. I ask hon. Members to look very closely indeed at the maps that were sent to them recently by the Post Office. They will be most interesting. I do not think all hon. Members have tumbled to the idea. The right hon. Gentleman could not have taken a worse example than Keighley. I admit that he can go to Burnley or to Westmorland. I would not like to say how many miles it is; perhaps thirty. We can go to Bradford. The right hon. Gentleman even went so far as to say that 59,000 subscribers would be affected.
So far as I can see, Leeds is left out. The circle in my map is broken, and, therefore, I assume that Leeds is out, although the amount of telephoning between Keighley and Leeds is considerable. There is no hon. Member present from Sheffield, so I suppose I can say that Leeds is the prime city of my native county, and I think I am right in that. I hope that hon. Members will look carefully at their maps. I am not blaming the right hon. Gentleman or his Department for doing it because they obviously wanted revenue.
Are we ever going to do anything about a 3d. bit coin-box in our call boxes? Surely it is not beyond the wit of Dollis Hill rapidly to alter the mechanism in the boxes. I gave full marks to the engineers when adjustments were made for the weight of four pennies instead of the weight of three. If we can do it with tanners and bobs, surely we can do it with the 3d. bit.
I used not to accept the idea of a timing arrangement in call boxes, but in railway termini where many large call boxes are in use I think it is necessary to limit the call to three minutes. We see people waiting in the cold while some young lady is ringing up her beau. Usually the women are at fault. We ought to do something about it. I say that seriously.
There is a deficit on telegrams; there always will be a deficit. I welcome the new committee of inquiry, but I assure the right hon. Gentleman that there must be a considerable space in the archives of the Post Office containing reports on the telegrams service. I do not know what can be done about it, but I am rapidly coming to confirmation of the idea that I had when I was at the Post Office, that a serious review must be made of having the Department on a care and maintenance basis. The telephone is killing the telegram, and this is bound to happen. We do not want redundancy to arise; people have to be absorbed. We have to keep a telegraph service for strategic reasons. I hope that matter will be looked at very seriously.
I should like to know if the through-switching of telegrams has been completed. There has been a scheme under consideration for a long time. The amount of mechanisation done in the telegraph service over many years has shown that the Post Office is fully aware of this problem of reducing the deficit. It has tried every expedient, spent thousands on mechanising the service, increased the cost of greetings telegrams, and done all sorts of tricks, but none of them has worked. Therefore, an inquiry is necessary.
Reference should be made to a backwater of the Post Office and to the very important work of the wireless branch and ship-to-shore radio. How is it getting on? That subject seems to be tucked away and we never hear about it. It is a sort of silent service.
As a more immediate matter, I want to raise the whole question of wireless interference. The Post Office is responsible for suppressing it. How many regulations have been laid under the Wireless Telegraphy Act, 1949, dealing with this problem? All the time the right hon. Gentleman is speaking about interference in wireless reception there is propaganda from radio manufacturers making v.h.f. sets, but v.h.f. is becoming the subject of quite a considerable amount of interference. It is no good saying that people have not got the right aerials, because interference comes from motorcars, motorcycles, television sets and household apparatus. People want to know how many regulations have been laid and

whether any further ones are to be laid to deal with this problem.
A final section to which I want to refer is the maritime branch and the cable ships. Reference has been made to the work done by the "Monarch". I should be glad to know whether there are any other large schemes in hand for that vessel. It has certainly been a very good dollar-earner for Britain. It has just completed the Pacific cable, and there has been the laying of the Atlantic cable, which was a joint undertaking by the Canadian and United States Governments. What is the position about the fleet? The "Alert" is finished. It is an old ship which was reconditioned. We had it from the Germans as war compensation. Are we to keep the fleet, or is Cable and Wireless to do this work? A decision should be taken on whether the fleet is to be extended, or kept to four vessels, or whether—as I have heard rumoured—Cable and Wireless is likely to do some of the work. That should be cleared up, if only for the sake of morale.
The Post Office does a first-class job economically and efficiently, and it is certainly the finest Post Office in the world. One has only to talk to Americans to realise that. An American will say, "Guy, your postal services are good!" That is something of which those of us who have been associated with the Post Office are proud. We are proud to pay tribute to the efficiency of the Post Office, and, in relation to present price levels, the costs are not unreasonable.

7.5 p.m.

The Assistant Postmaster-General (Mr. Kenneth Thompson): This has been an interesting debate in many ways, in that so much has been said in praise of the Post Office from all sides of the House that it is a little difficult to regard oneself as replying to a critical debate. I should explain to the House that the right hon. Member for Caerphilly (Mr. Ness Edwards) had to leave the Chamber. He mentioned to me before he went that he had to go, and we quite understand the reasons for his not being here at this stage of the debate.
The right hon. Member based a fair amount of his criticism of the speech of my right hon. Friend on the fact that my right hon. Friend had not devoted the greater part of his speech to discussing the accounts. I think we ought to


keep clear in our minds precisely what is the nature and purpose of this debate. None of the exciting, imaginative developments my right hon. Friend was able to describe to the House would be possible unless we had first put the finances of the Post Office on a realistic, businesslike basis. The accounts we have published make it perfectly clear that that is precisely what we have been trying to do.
This is not something that has happened overnight. The process began some time ago and has been continuing steadily until we have now arrived at the stage of the money Bill. We have reached the position in which our accounting is on a reasonably firm and readily recognisable commercial footing. We set aside sums of money for depreciation and we draw in new money from the Treasury as a result of this Bill, a sum only sufficient to equal the new investment we want to undertake, and the charges which we make to our customers are based upon the economic value of the services we render to them resting on that realistic accountancy basis.

Mr. Ross: The hon. Gentleman said that the Post Office sets aside sums of money and can draw upon depreciation allowances. Is it not a fact that there is a depreciation account and also a supplementary account?

Mr. Thompson: The facts are quite clear, and the hon. Member would do himself a service if he would try to avoid confusing his own mind. We are setting aside from our revenue sums equal to the proper amount due for the depreciation of the assets we use. We have that money available for ourselves. The hon. Member can perhaps satisfy any doubts that remain in his mind by refreshing his memory from what is in the Bill. We are asking for a sum of £75 million, which we hope will last us for about two years. That compares, or contrasts, with the sum of about £175 million or £185 million in other recent money Bills. The difference is the sum of the resources we re-create for ourselves by setting aside proper depreciation sums.
That is good commercial practice, and it is on good commercial practice that all the operations of the Post Office rest at present. We are dealing, as I am sure

the House realises, with a very big business. We have 50 million customers. We have 359,000 employees. The sum total of our cash transactions with our customers, including the agency services we render to other Government Departments, is about £5,000 million a year. We employ 359,000 men and women on our staffs and occupy 10,000 buildings. We have 4½ million telephone subscribers using 7¼ million telephones. We booked for them last year 3,750 million local calls and 321 million trunk calls. We handled 10,000 million pieces of mail for them. It is a large business, measured by any of the normal standards that one applies to a business.
Not only have we put our accounts on a recognisable commercial footing, but we have put our charges on a commercial footing, too. This is a matter which has interested several hon. Members who have taken part in the debate. It has been suggested that we might have approached our charging system in a different way, first of all in July when we had to raise our telephone charges and, secondly, last month when my right hon. Friend was able to announce new and refreshing changes in the telephone charging system.
It will help, I hope, to remove doubts from the minds of some hon. Members who have criticised this system if we begin at the very beginning. My right hon. Friend explained to the House how under the new system of charges we have made it possible for the telephone system and all its installations to be more efficiently and fully used now than was ever possible before. We could not do that until we had first of all established our charges on a sound economic footing. That means obtaining a reasonable economic rent for the telephones that we instal. It is not the slightest use installing a telephone at a sum greatly less than it costs us to put in a telephone, and to maintain it when it is in, and then to try to recover the deficiency by some other distortion of the charging system. The rent which we charge for a telephone that we have installed bears a direct and proper commercial relation to the cost of installing that telephone, providing the wires for the exchange and the switching equipment within the exchange itself.
Having done that, we make it possible for the machine to be properly and


efficiently used, and we can then come to the first stage, to which the hon. Member for Keighley (Mr. C. R. Hobson) has referred, at which we say to our customers or subscribers, "Within that system that we have arranged on an economic footing we can offer you a better kind of service than was possible when the service was limited by the charging system which pertained before."
We have reached that stage, and my right hon. Friend was happy and proud to announce to the House that the time had come for us to offer this advantage to the subscribers to the telephone system. Nevertheless, I hope that the House will not imagine that it would have been possible to take this further step without first of all having put the system on a proper footing.
The hon. Member for Kilmarnock (Mr. Ross) was a little gloomy about the extent to which subscribers to the telephone service found themselves unable to bear the thought of having to pay these extra charges. Let us have the facts on record. There is still a very large list of more than 200,000 people waiting to be joined to the telephone service. This is in spite of the fact that last year, in the year ending 30th September, we joined 400,000 new subscribers to the telephone service, which is more than 1,000 subscribers a day, seven days a week, for the whole of last year. We expect to join a similar number to the telephone service during the twelve months on which we have just embarked.
It is true that there were people who found themselves unwilling or unable to pay the new charges and that between the time of the announcement of the new charges and about a fortnight ago 120,000 people gave notice to terminate their agreements with the Post Office. I should tell the House, however, that normally in a comparable period of time more than 60,000 people give up their telephones. People die, people move, people change their habits, and there is a normal wastage of that order at any time during the ordinary run of the year. I think about 60,000 to 70,000 people can be presumed to have had as the reason for giving up the telephone the fact that we had had to put up the charges.
We are sorry about that. We are sorry to lose our customers. It is our hope that

many will come back. In fact, many of them are coming back. We are now receiving letters at the rate of about 500 a week asking us to cancel their cancellations. I therefore believe that the steps which we have taken have been shown to be right. Because we recognise that a certain amount of difficulty was bound to be caused to many telephone subscribers as a result of the change between the time they reached the decision to cancel their agreements and the time they saw the new development and decided to stay within the club, we have decided that we shall not be too brutal or hidebound about the reconnection charge. Where the instrument and the installation are still there many people will pay very little or nothing at all. We shall try to soften the blow to others as best we can.
The telephone service of the country is on a reasonably secure basis, providing a reasonably good standard of service for the great majority of people. We hope to see it continue to develop as well in the future as it has developed in the past.
On the subject of telephone and other buildings, to which the hon. Member for Keighley referred, we have long had a programme of building in the hope of being able to catch up on the arrears caused by various circumstances, such as a lot of war damage, rapid expansion in the telephone services—the postal service has also expanded—new towns being built and new extensions of towns, with great demands on the Post Office. We made a larger number of starts on new buildings during last year than in any year since the end of the war. There were about 170. This was not as many as we had hoped, but we hope to do a little better during the year which we are now starting, and we shall try to keep up the pace.
My right hon. Friend has set the senior officials of the Post Office the difficult job of trying to make it easy to erect new buildings and to have a kind of building which can be reproduced readily from place to place to meet a minimum standard need and still be capable of facile expansion as the demand for more accommodation grows in any area. The telephone service, therefore, is doing reasonably well.
If the House will bear with me, I should like to say a word about the Post Office stamp policy, which has been


mentioned in one of its aspects. I hope that the Scots will not think that either my right hon. Friend or I are in any way hostile either to the Scots or to Robert Burns. Nothing could be further from the truth. Both my right hon. Friend and I know Scotland well, and if he loves it as much as I do the Scots have nothing to fear on that account.
I hope that Scottish hon. Members and Scots outside will be ready to accept the assurance that we have tried to bring our minds to a position in which we can appreciate what Robert Burns means to the Scots. It is not given to the Sassenach to share to the full the joy and felicity of reading Burns' poems, but we can try, and I should like to assure our Scottish friends that we have tried, to come to a realisation of the importance of Burns to the Scots and Scotland. On the other hand we have a duty which transcends either what the Scots think about Burns or what we think about any of our national figures, some of whom are no less illustrious than Robert Burns.
We have to think about the policy of the Post Office towards the issue of stamps. That is our duty. We have to try to marry the responsibility of the Post Office for keeping a dignified high level stamp available at all the, different denominations with a proper regard for such considerations as those raised by hon. Members who want us to issue a special commemorative stamp for Robert Burns.
For a long time the policy of the British Post Office has been to treat its issues of stamps with, if I may use the word without offence, a conservative approach. We have sought to have a standard set of high quality and of a design which is acceptable and pleasing to most people both in this country and throughout the world. The central and focal figure in that stamp is the portrait of the Monarch. That has always been the case. It is subject to slight variations around the frame and around the head of the Monarch, but the Monarch's head is the predominant and over-riding feature of the stamp. That has been so for a great many years.
One of the results of that, not without some importance, and certainly not without prestige importance, is the fact that the British postal authorities are not called upon to put on our stamps the

name of the country of origin. We are the only postal authority in the world to which that applies. We issue special stamps from time to time; and hon. Members were quite right to draw the attention of the House to the fact that this year we issued a Boy Scout Jamboree special stamp and a little later, in September, a stamp to mark the forty-sixth Conference of the Inter-Parliamentary Union which took place within this Palace this year.
Those issues did not set a precedent of the kind which hon. Members were trying to argue. They were not commemorative stamps in the sense in which philatelists, the Post Office, or even hon. Members themselves, would understand that term. They were special issues but not commemorative special issues. Even the Boy Scout stamp did not commemorate the birth of the founder of the movement. It happened that the Jamboree in connection with which the stamp was issued was timed by the Boy Scout Association to coincide with the birth of the founder of the movement, but that had no relevance to the stamp itself.
After all, the Boy Scout movement is in a quite different category, with respect to the Burns movement, from those other things which have been suggested as worthy of the issue of a special stamp, for instance, in commemoration of the bicentenary of the birth of Robert Burns.

Mr. A. Woodburn: Am I to understand that if the Burns federations all over the world have a conference that will be the sort of thing which will justify the production of a special stamp—as distinct from the birth of Robert Burns?
The hon. Member seemed to think that the only people who knew anything about Burns were the people in Scotland. He cannot have seen films in which people have sung "Auld Lang Syne" in cowboys' camps; he cannot have heard "Auld Lang Syne" sung on the wireless many times; he cannot know that even in Moscow people begin to think that Robert Burns was one of their poets; and that the Americans, as Robert Ingersoll pointed out long ago, think that they appreciate him far more than do the Scots. He cannot know of the many pilgrimages of Americans to Burns's cottage; he cannot know that Ingersoll's poem is framed there as a tribute not


from Scots to a Scot but from Americans to a Scot.
If the hon. Member is suggesting that the only people in the world who appreciate Burns are himself and the Postmaster-General, he cannot have yet realised that many of his own poets, including Wordsworth and Byron, paid tribute to the work which Robert Burns did in destroying humbug—

Mr. Speaker: The right hon. Gentleman will pardon me if I remind him that we have still some time to go to 25th January, 1959.

Mr. Thompson: The right hon. Gentleman is a little ungenerous. I went out of my way to say that we have tried to draw away any veil which might be presumed to exist between an English Postmaster-General and a great Scottish interest, a great United Kingdom interest, a great world interest. That is what I have been trying to explain to the House.

Mr. Woodburn: Mr. Woodburn rose—

Mr. Thompson: I was hoping that I could bring the House back to the point, given a little time and opportunity to do so.
There is that difference between the two events. Every boy of every kind in every land and of every age is concerned, either nostalgically or in fact, with the Boy Scout movement.

Mr. Ross: Not the Boys' Brigade.

Mr. Thompson: It was on those grounds that the agreement was made to issue special stamps in connection with the Boy Scout Jamboree.

Mr. Ross: The hon. Member will appreciate that in that there is a break with established tradition.

Mr. Thompson: No. There is a marked difference between the two cases.

Mr. Ross: I am not now comparing the one with the other, the Boy Scout movement with the Burns movement. I am comparing what the hon. Member said about the tradition of British postage stamps and the suggestion that the break in tradition was made by that issue this year.

Mr. Thompson: I have done my beat to give the House information. I have tried to explain that there is a difference between a special issue of a stamp and a commemorative issue of a stamp. That is where the discussion began. I have clearly failed to make the point with the hon. Member for Kilmarnock, but I can only do my best. There is a world of difference between the two cases.
We do issue special stamps and I hope that nothing I have said to the House will lead people to believe that we do not. We shall issue more special stamps and we shall issue new stamps in Scotland, Wales, Northern Ireland, Jersey, Guernsey, and the Isle of Man. There will be no special stamps in England; they will be only for the other countries making up the United Kingdom. Stamps which have been designed and selected by Scots for use within Scotland will be issued in Scotland; similarly, special stamps will be issued for Wales, Northern Ireland, Jersey, Guernsey, and the Isle of Man.
It is our hope that the first of these stamps, the 3d. denomination, of which there will be six kinds representing each of the different countries, will be available some time during the middle of next year, and that the larger denominations of 6d. and 1s. 3d. will be available later, in the fall of next year.
We also intend to issue in July of next year a special stamp in connection with the British Commonwealth and Empire Games which are to be held in Cardiff. I do not want anyone to get the impression that the Post Office never issues new stamps. What we say is that there are difficulties which cannot be easily overcome in deciding when to issue a new stamp to mark any event. After all, England herself has some poets, not without merit and not without distinction. I am not quite sure whom Wales would want to commemorate, but there is a long list of distinguished people of all kinds, in England, Scotland and elsewhere, who would have at least a claim for commemoration of this kind equal to that of Robert Burns.

Mr. Emrys Hughes: Why not those as well?

Mr. Thompson: There is a simple practical problem with which we have to deal, of how we are to issue the stamps and what kind of stamps they are to be.


We start from the fact that our stamp has as its predominant design the portrait of the Monarch. Is the stamp to be faced with the portrait of Robert Burns? Is that the way it should be? I doubt that that would give pleasure to everybody, even to all Scots.

Mr. Emrys Hughes: If that objection were put to the Monarch, the Monarch would not object, because she is half Scots.

Mr. Thompson: It is important that my right hon. Friend should reach a decision before the matter goes to the Monarch. We should not want to put the Monarch in a position which she might find difficult or embarrassing. That is one of the difficulties which has to be faced by those who want us to issue a special stamp in connection with Robert Burns. We have given a great deal of thought to the matter.
I have tried to convince the House, I hope with some measure of success, that we have tried to see the matter from the point of view of the Scots themselves and of those who like the poetry of Robert Burns—and I include myself among those who spend a fair proportion of their time, usually very late at night, singing "Auld Lang Syne".
That was not the only question raised in the course of the debate.

Mr. Ross: I want to put a specific proposal. Will the Postmaster-General consider discussing this matter with a delegation of Scottish Members of Parliament?

Mr. Thompson: I cannot commit my right hon. Friend beyond the normal usages of the House. If any group of hon. Members would like to meet him, I am sure that he would find time and opportunity to interview them. If the request is put to him in the proper way—it has not been put to him yet—I am quite sure he would do as I have suggested.
I pass on to one or two of the other questions raised in the debate. I was very grateful to the hon. Gentleman the Member for Keighley who mentioned the cable ships. It would be rather strange if the House could go through a full day's debate without paying some recognition to the work that the British cable ships have done and are doing. I suppose that there is no more outstanding example of the progress and imaginative outlook of

the British Post Office and the technicians at Dollis Hill and in other parts of the Post Office than is to be found in the work of the cable ships and of the cables for which we are so very largely responsible.
We have the finest cable-laying system in the world. When the Americans wanted to lay a cable across the Pacific, it was to Great Britain that they came to get the ship and the skilled personnel to lay the cable. We laid that cable, and did it highly successfully. A large part of the cable was made in this country. I should like the House to know that the ship that laid the cable earned no fewer than 600,000 dollars in doing the job. So the House has every reason to be proud of it. It was also the British cable ship "Monarch" which laid the Atlantic cable which has brought such revolutionary changes to the telephone conversations that take place now between this country, Canada and the United States. So successful has that cable been in its practical use and in the commercial returns that have flowed from it that the Americans decided they would like to lay another.
Now a cable is to be laid, again using the "Monarch", from America to the Continent, to France and Germany. This will be an American enterprise. It will consist, as does the existing Atlantic cable, of two cables carrying traffic in either direction and using American repeaters. We have a further striking development almost ready for exploitation. We have recently reached an agreement with the Canadians to lay, in the course of a few years, another cable across the Atlantic. This one will be a single two-way cable using a new British plastic cable, developed by Post Office engineers and the cable company with which we work, and British two-way rigid repeaters. The present Atlantic cable, which is a double cable running in each direction, provides 36 conversation channels—on the two cables. Our new cable will provide 60 conversation channels on the one cable, a revolutionary development, and one for which the engineers of the Post Office and the industry have to take very great credit indeed.

Mr. Douglas Glover: Did the new cable invention come from Dollis Hill, or was it produced by one of the cable companies?

Mr. Thompson: This is a Dollis Hill development in all its aspects, but we have had the co-operation and help of the industry itself in making the specimens and testing them under the conditions in which they will be used when the cable is laid.
An hon. Gentleman mentioned the cable ship "Alert", our oldest cable ship. It is not yet finished. It has been given a very impressive face-lift. It is still not the most ideal of ships, and at one stage or another we shall have to get rid of it; but it is not a bad thing that we have not got rid of it yet.
The developments to which I have referred show that we have not reached the end of the technical development of cable laying and the demands that may be made on a modern cable-laying ship. Before we replace the "Alert", we have to satisfy ourselves that we have done all these things. A great many other points have been mentioned, many of which I shall not have time to reply to tonight, but in so far as hon. Members may have a personal interest, I will either write to them or they can write to me.
Phonograms and directory inquiries are speeded up, and we believe that the public are being given a better service than before, and we shall continue to ensure that the service is developed to meet the demands made upon it. One thing emerges from all that has been said about the Post Office this evening. Not only is the Post Office a highly geared and efficient commercial undertaking, doing very well the job entrusted to it, but it also has a very large social content in the provision of rural kiosks, the carrying of letters from the south of England to the north of the Shetland Islands, for a standard sum, and sorting out parcels and carrying them great distances, very often at an uneconomic return—and all those things are done by way of service which people have come to expect from us in our Crown offices and sub-offices.
I think that it will be in the terms in which this House would wish the debate to end if I pay my tribute to all who work at every level in the Post Office for the way in which they have discharged their duty and rendered to the public the service for which the people look.

Mr. Glover: I was not quite certain, when listening to the very brilliant speech by the Postmaster-General, about one point concerning depreciation. Do I understand that now the Post Office has got a system of agreeing with the Treasury that depreciation shall be on the replacement value and not on the original cost value? That is a very important departure from the Treasury point of view, and I have no doubt that private industry would be very interested indeed to see the principle established that in future it is accepted by the Treasury that the wise thing is to give allowances for replacement at present cost rather than replacement on the original cost price.

Mr. Thompson: My hon. Friend is roughly right in his assessment of what the change means. He was not here when I was dealing with this point at the beginning of my speech. If he will do me the courtesy of reading my remarks together with the accounts, a copy of which I shall be pleased to send to him, I am quite sure that he will see that we do satisfy the point that he is raising.

7.38 p.m.

Mr. John Baldock: There are one or two points concerning the use of telephones, particularly in rural areas, which I should like to put to the Postmaster-General and ask the House to consider for a few moments. The principal aspect on which I think a great deal of economy can be made with regard to rural telephones is where the lines run along the side of roads and lanes, which, in the aggregate, must be tens of thousands of miles—and trees overhang the wires or get mixed up with them. Anyone trying to use a telephone in those circumstances will probably find that where there is a strong wind or snow or unusual weather conditions his telephone is put out of order.
It requires only a small twig to touch two wires, as I am sure the hon. Gentleman the Member for Keighley (Mr. Hobson) opposite knows, to put a telephone out of action or to make it ring incessantly at night, which may be even more tiresome. The only thing the subscriber can do is to take off the handset to save himself being persistently rung up. A very simple method of avoiding this is to use wires that have an insulated plastic covering, and then it does


not matter if the branches touch the wires. The amount of money wasted is quite considerable, quite apart from the irritation to the subscriber. There is also a considerable amount of time wasted by telephone engineers and maintenance men who go out and follow along the wires from the exchange to the subscriber trying to find where this one twig is touching the wire. They proceed to snip the twig off and go back to their depot, having done the job. But, of course, in a year's time a great many more twigs have grown and the same thing happens all over again. The men solemnly snip off another twig.
I should have thought that they should either make a severe pruning of the branch so that it would not grow back over the wire for many years, or, even simpler, that the wire should be covered with plastic material, as I know has been done in other cases. This would save the Post Office a substantial sum of money in rural areas.
Another point which arises is that very often in places far removed from a road poles have to be specially erected to carry one telephone installation. One then finds that another series of poles is erected for the electricity cable. There would appear to be a rather rigid set of rules relating to when electricity cables and telephone wires can be carried on the same pole. No doubt, this is due to the feeling that there might be a danger of the high voltage cables coming in contact with the telephone wires, but I cannot believe that that possibility could not be prevented. Thus a good deal of money could be saved by not having a duplicate series of poles.
I wish to support my hon. and gallant Friend the Member for Portsmouth, West (Brigadier Clarke) in his plea for reducing

the cost of telegrams when the sender and recipient of a telegram are both subscribers and when, as I think he expressed it, one is only asking the telephone service to send a message. It is not a question of getting people out on bicycles or of providing any other special service of messengers to carry a printed form to the addressee. It is only a question of sending a telephone message. The price of telegrams is already high, and many people are deterred from using the service. If my hon. and gallant Friend's suggestion were adopted, I believe that more people would be encouraged to use the telegraph service.

Question put and agreed to.

Bill accordingly read a Second time and committed to a Committee of the whole House.

Committee upon Monday next.

Orders of the Day — NEW TOWNS [MONEY]

Resolution reported,
That for the purposes of any Act of the present Session to increase the amount of the advances which may be made to development corporations under section twelve of the New Towns Act, 1946, it is expedient to authorise any increase, attributable to the provisions of the said Act of the present Session raising to three hundred million pounds the limit of two hundred and fifty million pounds imposed in respect of such advances by subsection (1) of the said section twelve (as amended by the New Towns Act, 1955), in the sums which, under or by virtue of the said Act of 1946, section two of the Licensed Premises in New Towns Act, 1952, or section sixty-eight of the Licensing Act, 1953, are to be or may be issued out of the Consolidated Fund, defrayed out of moneys provided by Parliament, raised by borrowing, remitted, or paid into the Exchequer.

Resolution agreed to.

Orders of the Day — NEW TOWNS BILL

Considered in Committee.

[Sir GORDON TOUCHE in the Chair]

Clause 1.—(ADVANCES TO DEVELOPMENT CORPORATIONS.)

7.45 p.m.

Mr. G. R. Mitchison: I beg to move, in page 1, line 12, at the end to insert:
and that the rate of interest on such advances made after the passing of the New Towns Act, 1957, shall not exceed three per cent. per annum.
This is an important Amendment, although it raises a matter which was fully debated on the Second Reading of the Bill. A number of detailed arguments were brought forward then, not only by myself but by my hon. Friends. We trust that they have convinced the Government of the sense of this Amendment, and accordingly we are now giving the Government an opportunity to show that they have thought better on the matter. Anxious as I am to hear the Minister say so, I do not propose to repeat the details that were given on Second Reading. I propose merely to summarise the position.
The present position is that we have before us the reports of the development corporations up to the end of March, 1957. At that time the rate of interest on their borrowings was 5½ per cent. and even at that rate of interest every single development corporation mentions the obstacle to its work that is presented by borrowing even at that rate. Since then we have had an almost unprecedented rise in the Bank Rate and a consequent rise in the rates charged to development corporations from 5½ per cent. to 6¾ per cent., and we may take it that the ill effects that the development corporations found by the end of March have since then become, from their point of view, disastrous.
What is happening is that these development corporations were set up to do the social job, among others, of providing communities of all types of people. When they are compelled to borrow, they have no property over which to spread the interest on their borrowings, other than that which they have built in recent years.

They have no old properties to fall back Upon.
The result of a high rate of interest is, first of all, that even at the end of March, 1957, they were being compelled to build houses of a lower standard than they wished to build, to cut down their building programmes, to restrict a number of other things that they would have wished to do and, above all, perhaps the most important thing, to charge a rent for these new houses which, notwithstanding such devices as pooling rents, differential rents and the rest of it, resulted in people being unable to come to the towns in question.
It is said that they have housing lists. That was the standard answer from the Government benches during the Second Reading debate. So has every other town in the country, and that is a remarkable tribute to the housing policy, or the lack of it, of this Government. It is no indication whatever that the rates of interest charged to development corporations at present are such as enable them to do their job.
We have in the contrary sense the reports of every one of them. I could quote various instances—Stevenage, for instance, saying to the Minister that this was a matter for his immediate and urgent consideration. This representation was made in the report for the year ending March, 1957. All that the Minister has done about it is, with the rest of the Cabinet, to approve the increase of the Bank Rate; with the rest of the Cabinet—for we must assume common responsibility in these matters—to approve an even higher rate of interest on the borrowings of the people who are doing this public work in the development corporations, and to do nothing whatever to help them in a difficulty which hey now say is cramping and hindering their work.
I quote one more instance, and this time from Wales. According to the Seventh Annual Report of Cwmbran, the demand for houses in the area continues to increase, and the need to find living accommodation for large numbers of additional families is likely to become more acute before long if the expansion of industry in the neighbourhood continues. The report then says that the difficulties of the high rates of interest and the rising costs of building—hon. Members will remember that 70 per cent. of


that difficulty even at that time was the higher rates of interest, and it would be a higher proportion now—make it difficult to build houses which will be let at rents within the means of the lower-paid workers within the area.
For how long do the Tory Government, even in the matter of advances to new towns, desire to keep out of what ought to be a representative community the common workers in an industrial area who depend on this new town for their houses? For how long do they propose so to work the financial machinery that, instead of producing a community which should be representative of every class in the country, they deliberately exclude from it the lower-paid workers, the very last people who should be excluded, those who suffer most from the housing difficulties in the countryside which, by and large, are now attributable in great measure to the policy of the Tory Party? For how long do they mean to go on like this?
The Amendment would enable the development corporations to do what they ought to be able to do and to lower their rents to the level which prevails in council houses all over the country. Instead of having to charge exclusive rents between 24s. and 39s., with another 10s. or more for rates, they would be able to charge something like the average council house rent of 14s. If it is said that this is a hidden subsidy, my answer is—to whom is it a subsidy? It is a concession to the development corporations exactly in the same way as the subsidies are a concession to the development corporations. The subsidies have proved insufficient. The reports show it. They are now suffering from the high rate of interest.
Not only would it be a concession to the development corporations but, if the Government persist in their policy about the future of new towns, in the long run the new towns will go to an agency which represents the Government themselves. At the moment, we have advances to Government bodies, nominated by Governments, working for Governments, doing something which is intended to enure ultimately, we would have it, for the benefit of local authorities, and, as the Government would have it, for the benefit of some Government agency or other. What is there wrong even according to

Tory principles in allowing this concession? What is right in it is perfectly obvious; it would enable the development corporations to do the job which they all say they are at present finding it increasingly difficult to do and which they will be unable to do without something of this sort.

Mr. C. N. Thornton-Kemsley: No one on either side of the Committee could possibly say that I am not interested in new towns. I believe that I have not lost any opportunity during the passage of this and similar Measures—I have in mind the town development legislation and so on—to speak in the House and in Committee in favour of the principle of new towns, the expansion of new towns, and the creation of as many new towns as possible. I ask any hon. Member who doubts that to refer only to the speech which I made last week during the Second Reading debate on this Bill.
New town development has been one of the striking manifestations of post-war progress in this country. People have come from all over the world to study this remarkable new organisation which we have set up, an organisation which is providing for the overspill population, as it is called, from the great urban conurbations, pleasant and spacious livelihood in new surroundings. The purpose and principle behind the new towns is, broadly speaking, accepted on both sides of the Committee.
I should like the Committee to start from the point of view that we all wish the new towns well. We all want to see them successful. We have every sympathy with the development corporations. They are giving a great deal of service, and their members and staffs are devoting much time and effort to ensure the success of the new towns. Naturally, anything which they urge in their annual reports must have the sympathy of the Committee.
We have before us, however, a proposal that the money which the Committee is asked to vote should be allocated, in part, to subsidising further, for that is what it amounts to, the rents of houses in the new towns. The Bill provides for a further £50 million of public money to be devoted to the further expansion of the new towns in Great


Britain, increasing in that way the total amount which the Exchequer will have voted for the management and administration of new towns from £250 million to £300 million in all. Nor is this to be the end of the story. The Minister told us in the House last week that it is expected that the new towns will cost, in all, about £375 million in Exchequer advances. Thus, the Government of the day on some future occasion will have to come to the House and ask for a further advance of something like £75 million of Exchequer moneys for the new towns.
I want to see more new towns, but my right hon. Friend the Minister of Housing and Local Government has said very clearly that he and the Government think that an investment of the order of £375 million in new towns is about right—about as much as can be voted by Parliament in the country's present circumstances for the existing new towns. The money which the Committee is voting tonight, and which the House will vote in passing the Bill, should be used for the purposes which were envisaged by the Government in accepting the reports of the development corporations. If a fresh purpose or fresh demand is placed upon the £50 million, there will then be less of the £50 million available for the expected requirements of the new towns.
Already, houses in the new towns are eligible for the higher subsidy rates, being eligible for the higher overspill subsidy. There is no evidence whatsoever of any failure to attract tenants to the houses in the new towns at the present rents. I do not say that I have been to most of the new towns, but I have been to many of them, and I have asked questions of the responsible officials. I have inquired from various reliable sources, and in every case I have found that every one of the new towns is experiencing not the slightest difficulty in finding tenants for their new houses even though some of the rents charged are higher than the local authority rents in the adjoining county districts.
The proposal is that new towns should be given some special privilege or advantage, that, instead of borrowing money at the market rate or at the rate prescribed by the Public Works Loan Board, instead of being tied to the normal

Treasury rate of 7 per cent., they should be enabled, by the Amendment, to borrow money at a rate not higher than 3 per cent. The effect of that would he to place new towns, and new towns only, in a special category, insulating them from the effects of the credit squeeze and all that we are trying to do to maintain the value of the £ and to halt inflation.
8.0 p.m.
I am quite certain that every hon. Member has some special cause or interest—it may be a constituency interest and one of the most worthy causes—which would make him dearly love to come down to the House of Commons and make an impassioned speech for the special consideration of that interest, and to urge that because it was such a worthy cause and one which was doing something in the national interest, it should be enabled to borrow money more cheaply. [Interruption.] Does the hon. Member for Edinburgh, East (Mr. Willis) wish to say something?

Mr. E. G. Willis: I have been listening for ten minutes to try to find the hon. Member's reasons for not supporting the Amendment. Up to the present, I have not heard any reasons. That was why I was becoming rather impatient and wondering when we were to be given the reasons.

Mr. Thornton-Kemsley: The hon. Member always gets impatient if he is not speaking himself. I shall be very glad if he is fortunate enough to catch your eye, Sir Gordon.

Mr. Willis: I spoke in the debate last week.

Mr. Thornton-Kemsley: I did, too. On that occasion, the hon. Member and I agreed much more than we are doing tonight.
If the Amendment is accepted and new towns are enabled to borrow money at 3 per cent., they will be placed in a special class of their own. Alone among the community, they will be insulated against the effects of the credit squeeze, the higher interest rates and the Government's attempts to halt inflation and to establish the value of money. That is not logical and reasonable and it certainly would not be fair to pick out one particular public development corporation as against other activities—as against, in


fact, the local authorities themselves—and give it that special privilege. Therefore. I oppose the Amendment. I hope that the Committee will not accept it and will reject the arguments advanced by the hon. and learned Member for Kettering (Mr. Mitchison).

Mr. C. W. Gibson: Whenever we are discussing matters like the building of new towns or housing generally, there is always, to use the words of the hon. Member for North Angus and Mearns (Mr. Thornton-Kemsley), every good wish and sympathy for the project on the part of hon. Members opposite, but seldom is there any practical help.

Mr. Douglas Glover: The good sense and sympathy of my hon. Friends is surely proved by the housing achievement of the Government over the last six years. It is much better than the record of the Socialist Government. Deeds speak louder than words.

Mr. Gibson: I should be out of order to pursue that. We are discussing a proposal to advance an additional £50 million to the new towns. As always on these matters, the Government benches express tremendous sympathy and good will, but show no desire to do anything practical to help. That is the attitude of hon. Members opposite, in spite of the fact that every new town corporation, as shown by the recently published reports, complains of the difficulties which it is encountering in doing its job because of the high cost of money and the high building costs.

Mr. Martin Maddan: Is the hon. Member suggesting that the development corporations should be singled out as an exception from the general rule that applies to local authorities, Government Departments and businesses—in fact, to everything?

Mr. Gibson: I hope I am preparing the ground for the application of this principle to all work of this kind by local authorities; but we cannot deal with that on this Bill. We can deal here only with the new town corporations.
I repeat that all the corporations complain very strongly of the difficulties they are facing because of the high cost of interest on their loans for building and

construction purposes. Therefore, if the House of Commons wants the new town corporations, towards which hon. Members opposite express such good will and sympathy, really to carry out the purposes contemplated by the House at the passing of the New Towns Act, we must do something more than merely express sympathy. The Amendment is a means of doing it. Three per cent. interest is quite enough.

Mr. Willis: Too much.

Mr. Gibson: It is very significant that since the Government came into office there have been about fourteen changes in the rate of interest of the Public Works Loan Board. The changes have all been upwards. The stage has now been reached when it is impossible even for new town corporations quickly to let their more expensive houses.
It has been said that it is possible to find plenty of tenants. I wish that were true. During the last twelve months. I could have put into new towns forty or fifty people from my constituency who urgently needed new housing accommodation and who were willing to go to live and to work in a new town had the rents not been utterly impossible.

Lord Balniel: The hon. Member says that development corporations are having difficulty in letting their houses. Which development corporations? That is certainly not the case in the two new towns which I represent.

Mr. Gibson: All the new towns around London are having the same trouble. [HON. MEMBERS: "Which ones?"] Hon. Members can read the reports as well as I can.

Mr. Mitchison: I, too, happen to represent a new town and I can give the assurance that that is the case. There are people who are unable to pay the rents of the houses. That is also the case, as the relevant report shows, at Cwmbran. Of course, if the new towns are intended only for people who can afford to pay high rents, I agree entirely with the hon. Member for Hertford (Lord Balniel) that there are such people.

Mr. Gibson: My hon. and learned Friend is much kinder than I am to hon. Members on the Government side. I refuse to be drawn from the point I was making that in my constituency there are


scores of families who would gladly have gone to any of the new towns around London had they been able to afford the rents which the new towns are compelled by financial stringency to fix. That is not moonshine; it is actual fact.
That applies so widely that Parliament should agree to let the corporations have the extra money that is coming to them, if they want it, at a lower rate of interest, so that they may be able to build houses which can be let at a lower rent, and to build factories which can be used for industrial occupation at lower rentals. Unless we do something of that kind, the purposes of the new town corporations will be completely stymied. We must help them if they are to carry out to the full all the things that the House of Commons said when we passed the first New Towns Act. They were not merely to house people, but to provide facilities for employment, the necessary social services, clubs, health centres, and so on. The new town corporations are all having very great difficulty, but it is not because they do not wish to do the work. They all have great plans for the extension and improvement of their towns, but all of them are encountering difficulty over the cost of their capital. The Committee would be unfair to the new towns if it did not agree to do something to help, and to reduce the rate to 3 per cent. is a practical sensible and, I think, inevitable way of helping them.

Mr. David Price: I was a little diffident about intervening because, unlike my hon. Friend the Member for North Angus and Mearns (Mr. Thornton-Kemsley), I did not speak on Second Reading but, having heard the hon. Member for Clapham (Mr. Gibson), I feel more than justified in taking part in the debate. The Committee will have noted the freedom with which the hon. Member wants to throw the taxpayers' money around and to build up special privileges. This comes well from a party that claims not to stand for privilege. As the Committee knows, I normally try to intervene in economic and financial debates, but it seems that we who take an interest in those matters are very delinquent in our duty if discussion of this kind of Amendment is typical of the sort of thing that goes on when we are not on the job.
There was a time when hon. Members took pleasure in saving the taxpayers' money, instead of going to their constituencies and gloating about the higher figure they had managed to squeeze out of the Government of the day. There was a time when we were watchdogs of the public's money, and the public are our constituents.

Mr. Mitchison: Would the hon. Member agree that that was before £30 million were given in the last Budget to the Surtax payers?

Mr. Price: The right hon. Member for Kettering (Mr. Mitchison) is straying far from the point of the Amendment and I would not tax your forbearance, Sir Gordon, by widening the debate. But if the right hon. Member will spare the time, either in public or in private, I should be delighted to take him up on the point that £30 million were given away—from money brought into the Revenue from the public. That is typical of the attitude of hon. Members opposite and of the Amendment.
We are putting up the ante by £50 million. It does not come from the widow's cruse of the Treasury Benches, because the Treasury has none. It comes from the taxpayer again. I wish that hon. Members opposite, when they propose this kind of Amendment, would consider the fact, and admit it, that the money will come from the taxpayer, who is not the bloated capitalist of Socialist mythology. I could show the right hon. Member for Kettering in my constituency many people who live in their own houses and who are old-age pensioners and I could show him pensioners who are landlords and who will, I hope, benefit from the Rent Act. The Amendment asks us to favour a privileged class—those living in the new towns. On what moral, social or economic grounds can hon. and right hon. Members opposite possibly justify that? They also ask that people in these new towns should be able to contract out of the Government's general monetary measures.
I know perfectly well that hon. and right hon. Members opposite do not agree with the Chancellors monetary measures. They have made that clear on many occasions, but as they have not yet a majority it the Committee and therefore have to


put up with these measures I should like to know, within that context, what moral ground they claim for allowing people in new towns to have special treatment compared with people living in older boroughs like the one I represent.
8.15 p.m.
How would hon. and right hon. Members opposite ask me to justify that to my constituents? They may say that this is just a back-door method of attacking the Government's monetary policy, but were we to adopt the Amendment it would not be that at all. It would be creating a little privilege on the side, and I cannot see any moral grounds for it. The hon. Member for Clapham tried to justify the Amendment as being part of his total investment policy. He falls into the common error on his side of the Committee that a curious thing which he calls "social investment" is something quite distinct from other investment. Apparently, while new towns as a social investment are a good thing to support, other investments are something rather wicked with capitalists behind them all. It is absolute nonsense.
Using the hon. Member's term "social investment", I suggest that the new oil refinery at Fawley is more in the national interest than some of his new towns, because by its experts it is earning food for the people, whether they live in the new towns or the old slums. That is a fact which the hon. Member and his hon. Friends are apt to forget. It is no use rising in an economic debate and voicing pious sentiments about the need to earn our way in the world and about more investment in industry and then, on a Bill of this kind, throw all monetary defence and economic policy aside because of so-called social investment. It is arrant nonsense. As for the right hon. Member for Kettering—

Mr. Peter Kirk: My hon. Friend keeps on referring to the hon. and learned Member for Kettering (Mr. Mitchison) as the right hon. Member. Is this a secret? Has he now been elevated to the Privy Council?

Mr. Mitchison: I am very much obliged to the hon. Member for Gravesend (Mr. Kirk) for doing what I have long omitted to do, because this kind of mistake happens so often that one would hardly be justified in interrupting an hon. Member every time the mistake is made.

Mr. Kirk: I would, of course, say to the hon. and learned Member for Kettering that he is much more deserving of the title than many.

Mr. Price: The permanent presence on the Front Bench of the hon. and learned Member for Kettering tempts one not to bother to look into his antecedents but to give him the courtesies which people who sit on the Front Bench have normally earned. It is a sound principle to be generous if one is disagreeing with somebody across the Floor of this Chamber and to pay him superfluous and even exaggerated courtesies.
In moving the Amendment, the hon. and learned Member for Kettering was back in his old assignment with inflation, which we have seen in the proposals he has put forward for the municipalisation of rented property. This is all part of a total programme. I am generous in saying that the hon. and learned Member is on his assignment with inflation, because on reading some of the proposals he seems to me to be much more on an assignment with highway robbery. You will be aware, Sir Gordon, that a onetime President of the United States, Teddy Roosevelt, said that a person who has not had the advantage of a school education may rob a freight car but it takes a man with a university education to steal the entire railroad.
I wonder whether hon. Members opposite, in tabling the Amendment, consulted the right hon. Member for Huyton (Mr. H. Wilson) and the right hon. Member for Battersea, North (Mr. Jay). If we approve the Amendment we are writing in permanently 3½ per cent. as the maximum in the Bill—[HON. MEMBERS: "Three per cent."]—three per cent.; I am sorry, that is even worse. The right hon. Gentleman the Member for Huyton made it perfectly clear in his articles in the Manchester Guardian on inflation, and agreed with me when I took it up with him in this Chamber that should the Labour Party find itself on the Treasury Bench it would be prepared to ues the monetary weapon "ruthlessly."
Therefore, even if we passed the Amendment, we should be tying the hands of the hon. and learned Gentleman's right hon. Friends, if they should ever find themselves in Government. I therefore suggest to the Committee that not only in the interests of the country


but even in the interests of the Labour Party itself, we ought to reject this proposal tonight.

Mr. Granville West: I wish those who are represented by Tory Members were here tonight to observe their demeanour and listen to their contributions. I have no doubt that they would be very much moved by the sympathy hon. Members opposite are showing to the difficulties that tenants in the new towns are now suffering as a result of Government policy. I understood that the hon. Member for Eastleigh (Mr. D. Price) was prompted by the speech of my hon. Friend the Member for Clapham (Mr. Gibson) to deliver himself of the oration to which we have just listened. I have never seen an impromptu speech so much studied and so carefully prepared. Page by page it was delivered.
In any case, the hon. Gentleman's contribution to the debate has apparently been on the general theme of economics and not on the great problem of new town development that faces us tonight. The Parliamentary Secretary who has been listening to the observations of his hon. Friends has, I think, indicated his case, and I have been interested in the discomfiture he has experienced as a result of those observations, because I know that the Parliamentary Secretary himself believes in the constitution of the new towns—

Mr. Glover: So do we.

Mr. West: If the hon. Gentleman who makes his comments sitting down really had any sympathy with the new town tenants, his observations and interruptions of my hon. Friend the Member for Clapham would not have been put in the way he did put them.

Mr. Alan Green: What the hon. Member is really saying is that the inhabitants or would-be inhabitants of the new towns—with whom we have real sympathy—ought to be in a better position to borrow money than the inhabitants of what we might call the old towns. That is a premise that we on this side simply cannot accept. If they must argue in a certain context, we do invite hon. Members opposite to keep-within that context and not keep running out of it.

Mr. West: I was hoping to demonstrate to hon. Members opposite that the new town tenants desire, need and deserve special consideration, and if the hon. Gentleman does not know the policy underlying the Amendment we will try to inform him.
New town development was a grand social conception accepted by all parties in this House. The new town corporations have been entrusted with the momentous task of building up the new towns and, in some cases, of creating a balanced community within them. Unlike the authorities in many urban district and other local government areas, the corporations, in building new towns, have had to put in new sewers, new roads—they have, in fact, had to start from virgin soil.
The result has been that the cost of developing many new towns has far exceeded that incurred by other local authorities. When the Parliamentary Secretary replies, I hope he will tell us whether it is not the fact that the new town corporations have had to face expenditure heavier than that incurred by other authorities. In fact, he may remember that Cwmbran, which I have the honour to represent, is rather different even from the others in that it is really a grand housing estate built for the purpose of manning industries already there. Cwmbran is not in the favourable position of those other new towns which other hon. Gentlemen represent, where, in addition to the rents from houses, they enjoy the rent income derived from industries created in them to build up a balanced community. The other new towns have a great advantage over this one.
As I say, Cwmbran is essentially a housing estate. It has had to develop on terrain which is difficult and expensive. I have, on earlier occasions, made representations to the Ministry about the cost of developing it, and investigations undertaken by the Ministry have established that the cost of development and the rents that they have to charge are in excess of those that can be charged by comparable authorities. Cwmbran is in a most unfavourable position. It is, clear, therefore, that if hon. Gentlemen opposite are to do more than pay lip service to the grand conception of new town development, they really must face the problem of providing additional assistance for development, unless they are to fail in their duty.
I put this to the Parliamentary Secretary. Does he think that any new town, and particularly Cwmbran, will be able to proceed with the development that his Department and he himself would wish in view of the high interest rates now being charged? Hon. Gentlemen opposite, including the hon. Member for Hertford (Lord Balniel), have said that there is no waiting list of tenants in the new towns—

Lord Balniel: I did not say that. What I did was to point out that in the new town of which I have knowledge—and I am afraid that I have no knowledge of Cwmbran—the development corporation has no difficulty whatsoever in letting any of its houses. That is all I say.

Mr. West: I accept that. Perhaps I misunderstood the noble Lord, and I hope that he will forgive me. But, although his new town corporation has no difficulty in letting houses, will he tell the House the turnover of tenancies within his new town?

Lord Balniel: Not without notice.

Mr. West: I am prepared to tell him that the turnover of new town tenants is greater than will be found among tenants of local authority houses. The reason is that the new town rents are high. It is true that there are people who are desperately anxious to get a house and are, therefore, prepared to pay exceptionally high rents, but they find that they are unable to maintain them. That is the case in my own area. In order to obtain possession of houses, the new town corporation has had to take proceedings against tenants who cannot continue to pay their rent, and I suggest that that is the case in the hon. Gentleman's new town as well.
So when we deal with this problem, I suggest to the Minister that special treatment and special loans at cheap rates of interest should be given to the new town corporations. I ask the Parliamentary Secretary to give weighty consideration to the arguments advanced from this side of the Committee if he desires the new towns to succeed, as I hope and believe he does, unlike some of his hon. Friends, judging from the interruptions. I believe he desires the new towns to develop and prosper. I hope he will realise that they

will not be able to do that unless provision such as this Amendment suggests is made by the Government.

8.30 p.m.

Mr. Denzil Freeth: The hon. Member for Pontypool (Mr. West) began his speech by saying that the new towns presented essentially social problems. I suggest that one of the main difficulties in arguing or discussing these matters with hon. Members opposite is that when they state that a certain matter is a social problem they automatically assume that thereby they are denying the fact that it is an economic problem as well. We on this side of the House do not believe that it is possible, from the point of view of this House, the point of view of the Exchequer and the money which in Committee or otherwise we vote to it, to divorce social problems from economic problems.

Mr. Arthur Palmer: Nor does anybody else.

Mr. Freeth: If the hon. Member really meant that nobody else believes that it is possible to divorce social problems from economic problems he would not continually support Amendments made from the opposite side of the House day in and day out to increase Exchequer expenditure without saying a word about where the money is to come from or which tax is to be put up.
The hon. Member for Clapham (Mr. Gibson) began his speech by saying that he thought 3 per cent. was a fair rate of interest. I find the concept of a fair rate of interest completely foreign. To whom is 3 per cent. meant to be fair, and under what conditions? In the days of what is known in the City as "cheap money" when the right hon. Member for Bishop Auckland (Mr. Dalton) was Chancellor, "Daltons"—if I dare mention them—were standing at par. Three per cent. in those days would have been very dear money indeed. I do not think it would be fair money today when the Bank rate is somewhat higher than in the right hon. Gentleman's time. Three per cent. is equally the wrong rate.
The idea of a fair rate of interest is obviously the idea which people happen to desire for an object of their choice at any particular time. It has no permanent validity. There is no such


thing as a really fair rate of interest, because in the days of the right hon. Member for Bishop Auckland 3 per cent. would have been too high. Today I think it is fair to say that 3 per cent. is obviously too low. If we give to one section of the populace, be they great or small in numbers, the advantage of privilege of borrowing money from the Government at a lower rate of interest than that at which the Government have to borrow, then we are giving them an extra subsidy. It may be right to give certain members of the community a subsidy on housing, on medicine, or on something else. No one can say that a particular rate of subsidy is necessarily fair when such a rate of subsidy is given to people of entirely differing incomes or entirely differing numbers in family or to people who happen, partly by chance or partly by good luck, to be living in good times.

Mr. G. Lindgren: Would not the hon. Member agree that the Government themselves are not above taking money at 2½ per cent. from the very small investors, the widows and other persons who can only put their money in the Post Office?

Mr. Freeth: I would be delighted to follow the hon. Member into this question, which seeems to be almost better suited to the Trustee Savings Bank Bill to be debated next week. But the widow, the orphan, or whoever it may be, does not have to put his or her money into the Trustee Savings Bank or the Post Office Savings Bank. Such a person can get excellent advantages by investing in National Savings Certificates. He can get a higher rate of interest in Defence Bonds, or an even greater return by buying Premium Bonds, which my right hon. Friend the Prime Minister has introduced so successfully as a stimulus to the National Savings movement, and—I am not saying this because I happen to be a stockbroker—he could even buy a unit in a reputable unit trust. The interruption of the hon. Member was a most delightful but very poor one.
A rate of 3 per cent. cannot possibly be considered a fair rate at any time except when it is the rate of interest for a loan of about sixty years. Only then could it be considered fair, because borrowing money depends upon two sorts

of people—those who borrow and those who lend. If we believe that it is right to be fair to both sides in any bargain, it is nonsense to suggest that any bargain which is unfair to one side can be considered as a fair bargain, or the rate of interest therein fixed a fair rate.
If we are to accept the argument of the hon. Member for Clapham that 3 per cent. is a fair rate of interest for those who live or will live in the new towns, we must follow his argument, as he said quite logically, and extend the area covered by the 3 per cent. umbrella into many more social services. There are still many people who need houses. Hon. Members opposite are never tired of pointing that out, although they occasionally forget to point out that in six years they provided less than 1 million houses whereas we have provided 1,750,000 in the same period.
I agree that there are still many people who need homes in the new towns and elsewhere and are looking for them as hard as they can. But if the hon. Gentleman proposes that local authorities should borrow at 3 per cent., is he doing so in order to annihilate our suggestion that he is recommending that those who live in new towns should be in a privileged position? The hon. and learned Member for Kettering (Mr. Mitchison) said that the people who lived in new towns should be in a special position because the new towns did not have the residue of houses built in earlier days when interest rates were lower. But the hon. Member for Clapham departed from the advice given by his leader. He said that he thought that over the whole range of social investment the rate should be 3 per cent. If he really believes that it would be interesting to know exactly what is the policy of the Labour Party.

Mr. Gibson: I did not say that—and, unlike the hon. Member, I happen to know that Adam Smith is dead. What I did say was that that was the course of action for the future.

Mr. Freeth: I agree with the hon. Member that Adam Smith is dead. Socrates is dead.

Mr. Lindgren: The Tory Party is dead.

Mr. Freeth: I rejoice to say that the Tory Party is not dead. But, although philosophers may die, the truth—

Mr. Green: Whatever interest the party opposite may have in these rather bygone figures, does my hon. Friend agree that the people who are to find the money, whether at 3 per cent. or 7 per cent., namely, the savers, are in this country and are not dead?

Mr. Freeth: The point that I was trying to make is that philosophers may be dead but the truths that they taught still have validity. One of those truths is that we cannot borrow money at a rate cheaper than that at which people are willing to lend it. Another is that we cannot get the Labour Front Bench to agree with its supporters on the benches behind it.
There happen to be a number of very desirable objects for which an interest rate of 3 per cent. would be eminently desirable to people who happen to support the objects. I sit not for a constituency in which there is or is proposed to be a new town, but for one in which it is proposed that negotiations should be entered into between one of my borough councils and the London County Council about the possibility of settling about 12,000 people from London within the boundaries of my constituency. I do not know whether those negotiations will prove successful or not, but I am certain that the people who may come out from London, and for whose welfare the ratepayers of Basingstoke will have to make sacrifices, will look—

Mr. Dudley Williams: On a point of order. There are many hon. Members who wish to make constructive remarks about this Measure. I wonder whether it is possible, Sir Charles, for speeches to be reasonably short.

The Chairman: That is not a point of order, although I have often felt sympathy with that point of view.

Mr. Freeth: I sympathise with your point of view, Sir Charles, particularly when certain hon. Members from the south-west of England are speaking.
It is unfair that a particular section of the people who happen to live in a new town should have the benefit of this concealed subsidy. I would prefer my hon. Friend to suggest that those who live in new towns should have a grant or a gift. I would admit that as a way of solving the problems of the new towns, but I

object to the idea that it is right to give one section of the populace the opportunity of borrowing from the Government more cheaply than the Government themselves can borrow.
As my hon. Friend the Member for Eastleigh (Mr. D. Price) said, certain types of investments are said to be intrinsically more desirable than others. All investment is desirable, but some investments apparently are more desirable than others. It is right that people should invest money in coal mines, schools and hospitals. It is even more right tonight that we should invest money more cheaply in the new towns, but when a Bill proposes to give money to any other section we can be certain that hon. Members opposite, in their lust for votes, will insist that that money shall be given to that section of the community more cheaply and upon more advantageous terms than would be given to private enterprise.
If we were to give this subsidy to new towns in a concealed manner and not by an open gift, it would cost the taxpayer about Ell million a year. Compared with a Budget of £4,500 million, that is very little, but, even so, it would provide school buildings and make a contribution towards the cost of new hospitals and new roads for speeding the traffic. It is worth considering whether at this time we want to give this subsidy to the new towns in addition to the subsidy which we are already giving to them, because they get the benefit of the overspill grants on their houses.
8.45 p.m.
When this money is provided by the Government it has to come from one of two sources, either from the Budget surplus or from money raised by the Government in the open market. Hon. Members opposite have not suggested that taxation should be increased to meet this extra charge. One can always argue that the odd million here or there does not really matter, but it is a fact that if they expect, or hope, or pray to be the Government in three or four years' time—

Mr. Lindgren: In three or four months' time.

Mr. Freeth: If it is three or four months their attitude should be even more responsible. Over the years, there will be a


number of very substantial calls on the Exchequer without either hon. Members opposite or my hon. Friends making any proposals to the House which would in-increase expenditure. Only a week or so ago, I spoke in the House about the future deficit which will appear in the National Insurance Fund. It is surely wise for any Government to consider the future commitments it may have before entering into fresh ones. It is always important for any Government in peace-time to have a margin of taxation which they do not at the moment impose, but which could be imposed if necessity made it desirable.
The Leader of the Opposition, in his 1951 Budget, increased Income Tax by 6d. in the £ in order to meet a new necessity, the great new rearmament programme. He could not have done that if Income Tax had been already so high that any such increase would have meant the operation of the law of diminishing returns. Surely it is not right at the present time that we should make all other sections of the community give a concession to one section, which would involve this increased cost to the Exchequer.
There is also the question of the open market. At the moment, we cannot find an immense number of buyers in the open market for a loan floated by the Government. The funding operations of the Government are obviously being conducted with great difficulty. It is against that background that I think hon. Members have been a little less than generous. I was not present at the Second Reading debate on this Bill, but I have read it. They have been a little less than generous to the Minister and the Parliamentary Secretary in their attitude to the new towns. They might well realise that at a time when the Budget surplus is fully operated, at a time when the market does not easily facilitate the flotation of Government loans, the Government have decided to initiate a Bill to provide a further £50 million for the development of the new towns.
I have no doubt that the new towns are dear to the hearts of all hon. Members opposite. In 1946, they brought in a Bill to provide £50 million to get them going. All other Bills on this subject providing more money have been passed by Tory Governments. That, surely, is

some indication of which Government deals more effectively with the new towns. A sum of £50 million extra was provided by each of the Acts of 1952, 1953 and 1955, and another £50 million is to be provided by this Bill. I suggest that the Conservative Government have no cause for shame in their record and that they are quite right in refusing to accede, as I hope my hon. Friend will refuse, to the Amendment, which would give an unwarranted concession to one section of Her Majesty's subjects.

Mr. Richard Body: It is regrettable that no hon. Member opposite rose to take this opportunity of saying something about this very important Amendment to an important Bill. Perhaps this demonstrates a lack of interest. We have, of course, had a contribution from the hon. Member for Pontypool (Mr. West).

Mr. E. G. Willis: The hon. Member forgets that we voted on this issue last week. He is behind the times and needs to awaken a little.

Mr. Body: I will deal in due course both with what the hon. Member for Edinburgh, East (Mr. Willis) said last week and with his intervention. First, however, I should like to comment on the speech of the hon. Member for Pontypool. I should be the last person on this side to cross swords with him, because we have only just concluded a very happy tour of several thousand miles which we undertook together. He represents a new town, albeit a small one, and I also represent a new town, which is a very large one. Indeed, the new town which I represent will eventually be the largest of all the new towns. It will probably have a population of 100,000 people. All of them are much concerned about this Bill. I know that they regard it as a good measure, I am sure that they are grateful to the present Government for introducing it, and, for reasons which I will advance later, I am sure that they have grave doubts about the value of the Amendment.

Mr. Willis: Gratitude for paying £1 more a week in rent?

Mr. Body: As I have said, I will deal with the hon. Member for Edinburgh, East in due course. He is last in my order of priorities.

Mr. Lindgren: Why is the hon. Member filibustering?

Mr. Body: It is inappropriate for the hon. Member to accuse me of filibustering. I am not so much concerned with whether it is a Parliamentary or un-parliamentary phrase as with the fact that both he and I represent new towns. I see no reason that the new town of Basildon should not have its voice heard in this Chamber.

Mr. Lindgren: Like most of the hon. Member's statements, that was inaccurate. I do not represent a new town.

Mr. Body: I am sorry. The hon. Member lives in one.

Lord Balniel: For the hon. Member for Wellingborough (Mr. Lindgren) to live in a new town is not the same as for him to represent a new town. It is a very different matter indeed.

Mr. Body: I know that my hon. Friend will continue to represent that new town.
I agree with the view of the hon. Member for Pontypool that the new towns deserve special treatment. Hon. Members on this as well as on the other side of the Committee agree that they are a kind of social service. It is for that very reason that the new towns have been singled out for special preferential treatment. The subsidy in the new towns averages £32 a year on every house although the subsidy on ordinary council houses outside the new towns, excepting those for slum clearance, is being reduced to nil. Surely £32 a year is special preferential treatment and the new town tenants are grateful for it.
The hon. Member for Pontypool said that although he represented what was really a very large housing estate, there was a considerable turnover in the population of Cwmbran, and there was some dissent when he suggested that that must be the case in other new towns. I am very pleased once again to be able to agree with him and to say that in Basildon there is a large turnover of tenancies. Many people seek to live elsewhere after having stayed for only a comparatively short time.
Indeed, Basildon has been called a transit camp, but that is an exaggeration, because although there are many people who wish to leave—[Interruption.]—I will

deal with the hon. Member for Edinburgh, East in due course; he comes last—there are many others who are perfectly satisfied with the existing arrangements and who wished to remain. I must concede that many of those who are seeking to live elsewhere do so because of the high rents. I am not one of those who believes that the only way to reduce high rents is by subsidising them. I am convinced that there are alternative ways—

Mr. Willis: Such as?

Mr. Body: I have said several times that I will deal with the hon. Member for Edinburgh, East last. If the hon. Member had attended all the debates on new towns he would have already heard me explain in great detail some of the measures I have suggested to enable rents in new towns to be de creased. Unfortunately, he has not always shown a very great interest in the problems of the new towns, although those of us who are interested are very pleased to see him now taking that interest which we hope will continue and be abiding. Perhaps the hon. Member will learn from what we have to say.

Mr. Lindgren: Will not the hon. Member agree that Basildon Development Corporation is now having to pay 42s. a week interest on every house built? Is not that an extortionate "subsidy" for those who lend nothing but money?

Mr. Body: I know that the hon. Member for Wellingborough is very good at popping up with odd statistics and sometimes taking people unawares, but the hon. Member ought to realise that there are very many different types of dwelling in Basildon. Some have a high rent of as much as £5 a week, but they are for the so-called middle income groups. There are others with very small rents, those small dwellings built especially for single persons and old-age pensioners. To say that there is such a payment by a new town corporation for that last type of house is a fantastic exaggeration.

Mr. Lindgren: Surely the hon. Member knows sufficient about housing to realise that 1 per cent. on a £1,750 house means 6s. a week on the rent. That is not all. There is a 7 per cent. Bank Rate, and seven times 6s. is 42s.

9.0 p.m.

Mr. Body: Those are figures that come from the unofficial Labour Research Department. I am surprised that an Opposition Front Bench spokesman should cite with approval statistics garnered by a proscribed organisation.

Mr. Willis: Is the hon. Member aware that these statistics have also been given by his own Minister last week?

Mr. Lindgren: He does not read HANSARD.

Sir Ian Fraser: Long before there was a Labour Research Department I had learned that seven sixes are 42.

Mr. Body: The first statistic which the hon. Member for Wellingborough (Mr. Lindgren) thought fit to introduce was a fantastic exaggeration and one which does not apply to all the dwellings of Basildon, although it may apply to some of them. [Interruption.] I have already indicated the order of priority which the hon. Member for Edinburgh. East has in my speech.
The suggestions which I would make to my hon. Friend the Parliamentary Secretary, for reducing the rent, I have already made in the past at great length, and I certainly do not wish to spend much time this evening on repeating those suggestions and taking up the time of the Committee, when I know perfectly well that hon. Members, even if not on the other side, are anxious to make their contribution to this subject.
In spite of this Amendment, the same result could be achieved if some measures were taken towards economy in the new town corporations. I would repeat this evening two of the suggestions I have made in the past. The first is that the administration of most new town corporations is top heavy. Some of us have been to the head offices of these corporations and have seen the offices they occupy, the number of cars standing outside the offices and the number of people going to and from those offices. Of course, we recognise that the building of a new town is a vast enterprise. It must mean the employment of a large number of people on the executive work of building, but the actual building of a new town is done by contractors; it is not done by the new town corporations themselves.

The Chairman: I think that we are getting a bit wide of the 3 per cent., are we not?

Mr. Body: I want to get back to that, but I was suggesting that instead of this Amendment to the Bill the same result could be achieved, namely a reduction in rents, by alternative means and that those means would be inevitably better for the economy and better in the end for the new towns. The second suggestion which I was going to make was in the nature of the houses themselves but, as that may be out of order, I will not repeat that suggestion tonight.
My hon. Friend the hon. Member for Eastleigh (Mr. D. Price) said that the proposal would place the residents in the new towns on a special pedestal of privilege, that we should be conferring upon them something which no other householder enjoys. I should have thought that it would be unfair on all those who do not live in new towns to have to increase still more the subsidy which is already being given to those in the new towns.

Mr. West: Would the hon. Gentleman not agree that if the additional assistance which we are seeking were given to the new towns, it would merely bring the new town tenant into a comparable position with other tenants?

Mr. Body: I feel bound to disagree with the hon. Gentleman, because already one is giving to new town tenants preferential treatment in the form of £32 for every house—something which tenants in other housing estates are not given. I do not complain about that; indeed, I agree with it. I think it is a good thing that those who live in new towns should have such a subsidy. I am the last person to oppose such a subsidy, but I contend that that is a sufficient recognition of the difficulties borne by those who live in new towns and those who build them.

Mr. West: I am sorry to interrupt again, but does not the hon. Gentleman agree that when one compares the rent in new towns with comparable rents of local authority houses, the economic rental of the new town houses must of necessity be higher because of the increased site costs and other works which the new town corporations have to undertake?

Mr. Body: I agree entirely with the hon. Gentleman when he says that there are increased site costs incurred in the building of roads, the provision of street lighting, drainage, and other expenditure which has to be met by a new town corporation—expenditure of a kind which need not be incurred by an ordinary housing authority building an estate. But that is the very reason why the £32 a year is given to the new town corporations in respect of each house.

Mr. West: This is the last time that I shall interrupt the hon. Gentleman. I am obliged to him for giving way again. Having regard to the fact that he concedes that additional assistance is necessary for the new towns if the £32 subsidy is not adequate to bring the rent of houses in a new town into a comparable position with the rent of local authority houses, does he not agree that additional assisance should be given?

Mr. Body: That point is valid if it is a fact. It is perfectly true that a large number of rents in the new towns are in excess of the average council house rents—[Interruption.] I will give way to the hon. Gentleman if he wishes to intervene.

Mr. Willis: I was merely mentioning something about which the hon. Gentleman knows nothing, namely, new towns in Scotland.

Mr. Body: I shall not be deterred by that interruption. I do not want my speech to be prolonged unnecessarily by frivolous interruptions. There are some of us on the Committee who wish to go home tonight, and there are those of us on this side of the Committee who would like to make a contribution to this debate. I am more concerned with the intervention—

Mr. Ellis Smith: On a point of order. I have sat here for a long time, Sir Charles, and I want to ask for the protection of the Chair in order that proceedings in this Committee shall be dealt with according to the ordinary practice of the House of Commons. If you were to ask me, Sir Charles, what my greatest desire at this stage is, I should say that it would be that the disgraceful proceedings of tonight should be televised so that all the nation could see them. [HON. MEMBERS: "Order."] Let hon. Members call me to

order; let them carry on, and we shall see what takes place.
The point I am raising is this. It has been my experience oil several occasions, when we have had an exhibition of this kind, that the Chair has been very tolerant, as it has been tonight; but we have been subject to constant repetition—

Mr. Body: Constant interruption.

Mr. Ellis Smith: —which I should have thought should have brought a reply from the Minister long before now. My two points are these. The first, I know, is not your direct responsibility, except in so far as you can guide us, but has not the time arrived when the Minister should reply? Secondly, Sir Charles, have we not been subject to constant repetition, and, if so, should not some guidance be given to the Committee about that?

The Chairman: I have no power over Ministers, of course; I cannot call on them to speak. As regards tedious repetition, the hon. Gentleman knows very well that I have to put up with a great deal of it. I have used the rule, but it is difficult to know when the repetition becomes tedious. Sometimes it becomes tedious more quickly than on other occasions.

Mr. Body: I do not want to repeat myself, but a great many interventions have been made. I was trying to deal with the point made a few moments ago by the hon. Member for Pontypool. I agree with him entirely that there are many rents in the new towns which are higher than the average rent in a council house, but one should bear in mind that the new town is essentially a town of mixed population, having people from different walks of life, including those in the middle income groups and people who cannot afford a high rent, together with those who are, in the words of my hon. Friend the Member for Hitchin (Mr. Maddan), from the new industrial aristocracy. Council houses, on the other hand, are intended for those who cannot afford the economic rent for houses elsewhere. Thus, if one is to make a comparison, one should compare like with like.
I know that other hon. Members wish to speak, and I will now turn, as I


promised to do, to what the hon. Member for Edinburgh, East had to say. He did not, I think, make a speech during the Second Reading debate on 28th November, but he made one of his usual interventions. He asked:
What kind of standard is used to judge whether rents are within the compass of ordinary people?"—[OFFICIAL REPORT, 28th November, 1957; Vol. 405, c. 1317.]
Surely, the standard is whether they continue to live in the houses, whether there is a waiting list for them or whether people are seeking homes elsewhere. There is some evidence of that in a few of the new towns, but not nearly enough to justify the Committee in accepting this Amendment whereby one section of society has a privilege denied to everyone else.
It is a good Bill. In my submission, it is a great pity that it should be spoiled by party politics of the worst kind. I hope that the Committee will reject the Amendment and allow the Bill to be passed in its present form.

9.15 p.m.

Mr. F. M. Bennett: I have no intention of detaining the Committee very long. No one would be more delighted than myself if the Minister were now to decide after my short remarks to take the advice given him by the hon. Member for Stoke-on-Trent, South (Mr. Ellis Smith) from the back benches opposite and reply to the debate when, perhaps, we could reach a decision.
I had not originally intended to intervene in the debate. When I first saw the Amendment, I regarded it as a perfectly legitimate piece of party political propaganda to try to gain votes in the new towns but I thought that it was something which would not be seriously pursued here. I paid the Labour Party the compliment of believing that it would not seriously subscribe to such economic nonsense as is shown in the Amendment. Hence I came only expecting to see the usual kind of party political fireworks, with every attempt to gain votes in the marginal constituencies of the new towns; instead of which we have been subjected to arguments by hon. Members opposite seriously advancing the suggestion that it is possible to pick out one section of the community for a particular rate of interest.
In my comparatively short political career, I have had representations made to me from constituents and others representing a great variety of interests. Particularly at times of economic crisis, people have often said that they regard their own industry or enterprise as so essential that it should have a favourable rate of interest. Shipping people, for example, have said that shipping is so essential to the export trade that money should be available to shipping at 3 per cent. or lower. Agricultural interests also have said that for similar reasons they should be able to borrow money at a specially cheap rate. My hon. Friend the Member for Leominster (Mr. Baldwin) could say the same thing concerning small farmers. Small farmers are among those who are often especially hard done by, even though their enterprise is particularly necessary for the national wellbeing; but we refuse them preferential treatment in this respect.
It is impossible for anyone in this Committee, of whatever political party, seriously to suggest that one section of the community should get its money at anything other than the prevailing economic rate. To do so would mean opening the flood gates to a large number of demands which would be embarrassing not only to the present Government but equally uncomfortable for the party opposite if and when they ever return to power.
In these circumstances, to argue that anyone who opposes the lending of this money at an artificial rate of interest is against the conception of new towns, is not only wrong, but grossly unfair to Members on this side, who have the interests of new towns just as much at heart as anyone in the Committee. It might equally well be said that my hon. Friend the Member for Leominster is against the interests of farmers in his constituency if he tells them that they cannot have their money at 1 per cent., 2 per cent. or 3 per cent.
If the Amendment were accepted, how would it be implemented? If at any moment money can be borrowed only at 5½ or 7 per cent., to suggest that the Government should lend money at a reduced rate could mean only that it Rust be done by a subsidy. That is what the Amendment means. The Government


would be lending money at a rate considerably less than that at which they could borrow. Very often, we hear Members on the benches opposite suggest that the Bank Rate is far too high, but I have never yet heard Members opposite suggest the figure at which the Bank Rate should be fixed. The right hon. Member for Bishop Auckland (Mr. Dalton), who was present a short while ago, had recalled to his memory the time of the glorious song in his heart of 2½ per cent., but I have never yet heard a responsible Labour Party spokesman give a promise that when the Socialists return to power, the Bank Rate will he returned to 2½ per cent.

Mr. A. Woodburn: I notice that the hon. Member is an adviser to some merchant bankers. He knows, I take it, that the banks create the credit which provides the Government with the money. Undoubtedly, there is a certain cost in that. If the money is supplied beneath that cost, it involves a subsidy. Is the hon. Member suggesting that, since the Government have decided not to supply the money, they have no control over the quantity of money which is supplied by the credit they create?

Mr. Bennett: Perhaps the right hon. Member did not understand the point I was making. It has indeed been validated completely by what he has said. If he has an idea that banks have a widow's cruse of money whereas the Government have not he is completely wrong. The banks, like everyone else, have to find the money that they lend to the Government. That money comes entirely from customers' money and customers can get a high interest rate at the moment not only in this country but throughout the world, and banks could not borrow to lend at a lower rate.
My penultimate remark in this context is that if the Opposition accepts the premise that if one lends money at 3 per cent. and one can only borrow it, irrespective of the Bank Rate at several per cent. above that, the Opposition should come out in the open and say what extra taxes it proposes to impose on the community to raise the extra 2 per cent., 3 per cent. or 4 per cent. as the case may be. It is a typical piece of Socialist dishonesty to propose in this Chamber,

again and again, measures which involve the Exchequer in large extra expenditure, and never give the unhappy voters any indication of where the money is to be found—

Sir I. Fraser: Sir I. Fraser rose—

Mr. Ellis Smith: I beg to move. That the Question be now put.

Mr. Bennett: I sat down, Sir Charles, in the middle of a sentence, because I thought my hon. Friend the Member for Morecambe and Lonsdale (Sir I. Fraser) wished to interrupt me.

The Chairman: The hon. Member for Stoke-on-Trent, South (Mr. Ellis Smith) is perfectly entitled to move that Motion in the middle of an hon. Member's speech, but I am not prepared to accept it at the moment.

Mr. Ellis Smith: I begged to move the Motion because I thought that the hon. Member for Torquay (Mr. F. M. Bennett) had finished speaking.

The Chairman: Even if the hon. Member for Torquay (Mr. F. M. Bennett) had been speaking, it would have been perfectly in order for the hon. Member for Stoke-on-Trent, South to move his Motion. There was no need to wait until the hon. Member for Torquay sat down.

Mr. Ellis Smith: I know that, Sir Charles, but it is the usual courtesy to wait until an hon. Member has finished speaking.

Mr. Bennett: I know that, however much we differ from his views, the hon. Member for Stoke-on-Trent, Central (Mr. Ellis Smith) is never discourteous to hon. Members. I was sitting down because I thought that I was about to be interrupted.
As it is, I will not delay the Committee much longer except to summarise the remarks that I have made on an extremely limited front. We as a responsible body in this Committee cannot support a measure which makes economic nonsense. We cannot pick out one section of the community and advance reasons why it should be able to borrow money at an interest rate which does not apply to anyone else. I do not represent a new town, but I am sure that even the new towns themselves would not particularly like such


a privilege. People in the new towns are a little sick of being treated as members of experimental social bodies. They want to be perfectly normal members of a perfectly normal town community.
If we adopt the Amendment and give them this privilege we shall not be doing a service to the new towns, because we shall be telling electors in other towns, "You are having to provide extra taxes to give a special privilege to an extremely limited section." If we once opened that door we should be opening it wide to similar demands from every other section of the community. I hope that after the Minister's speech, which I am sure will endorse everything that I have said, we shall dismiss this proposal with the contempt it deserves.

Mr. Ellis Smith: I beg to move, That the Question be now put.

The Deputy-Chairman (Sir Gordon Touche): I am afraid that I cannot accept that Motion at this moment.

Mr. Ellis Smith: On a point of order, Sir Gordon. Did the previous occupant of the Chair inform you of the many points that we have raised from our own experience, and of the repudiation of Standing Orders by constant repetition? That is my first point. Secondly, did Sir Charles inform you of what has taken place? If so, can we have your advice, based upon the information that you should have received?

The Deputy-Chairman: I received all the information about what is going on, and Sir Charles informed me that he was not prepared to accept the closure at this moment.

The Parliamentary Secretary to the Ministry of Housing and Local Government (Mr. J. R. Bevins): I am obliged to my hon. Friend the Member for Exeter (Mr. Dudley Williams) who made a plea for short speeches in this Committee. Having served with my hon. Friend on the proceedings on the Local Government (Promotion of Bills) Bill some six months ago, that now seems to be dangerously like a piece of self-criticism. However, I shall try to take his advice.
We have had a very good-humoured debate, and, in the view of some of us, a surprisingly lengthy one. What always

intrigues me here in this Chamber is how so very often hon. Member on both sides seem to find virtue in silence, whereas on other occasions, of which this is certainly one, there seems to be a positive clamour to express varying shades of opinion.
We have had some excellent speeches from this side of the Committee, and I am indeed grateful for the support the Government have had from my hon. Friends. During the earlier part of the debate we had a speech from the hon. Member for Clapham (Mr. Gibson) which, I regret to say, was replete with inexactitudes. For example, he made the observation that since the Government came into office there have been fourteen changes in Bank Rate.
I must point out to him that there have been nine in that time, and not all of them were increases. But if he was referring to the experience of the present and the previous Administration, I would also remind him that of the five changes in Bank Rate which took place between 1952 and 1955, three were reductions. The principal increase, which took place in November, 1952, was, of course, brought about by the economic legacy bequeathed to us by the party opposite.
My hon. Friend the Member for Eastleigh (Mr. D. Price) referred to the articles written by the right hon. Member for Huyton (Mr. H. Wilson) in the Manchester Guardian, in which the right hon. Gentleman made it clear that a future Labour Government would not scruple to use the weapon of the Bank Rate in the economic interests of the country. My hon. Friend pointed out that if we were to accept the proposition embodied in the Amendment, that the new towns should enjoy a preferential rate of interest, that would, in all probability, tie the hands of a future Labour Chancellor of the Exchequer. That is a very ingenious argument, but it is, of course, fallacious, inasmuch as it assumes that the party opposite will be in that position—

Mr. D. Price: There was no such assumption. I was suggesting that as hon. Members were talking as if that would happen, they should consider what would happen if their hopes were realised.

Mr. Bevins: In that case, I at once apologise to my hon. Friend. The hon.


Member for Pontypool (Mr. West), who, I am sorry to see is not now in his place, suggested that I was grimacing while my hon. Friend was speaking. I apologise both to the hon. Member and to my hon. Friend. I can only say, in mitigation, that that is my normal and habitual expression.
As the Committee knows, this Amendment would fix a ceiling rate of interest of 3 per cent. on the borrowings of the development corporations of the new towns. As the hon. and learned Gentleman the Member for Kettering (Mr. Mitchison) said, interest charges are the main element in the housing costs of the new towns, and the obvious purpose of the Amendment is to reduce housing costs, and to enable the corporations to charge rents lower than would otherwise he the case.
9.30 p.m.
The rate of interest which is chargeable to these corporations was increased in September this year from 5¾ per cent. to 6¾ per cent. The Amendment, as I understand it, invites the Committee to discriminate in lending between development corporations and other bodies. I am still not clear why we should be invited to make such a discrimination. I do not believe that there is any justification for treating development corporations any differently from other bodies.
The average annual rate of borrowing by the new town corporations is at present about £32 million a year. If these corporations were to be exempt from the current rate of interest, one might well ask why that exemption should not apply also to other authorities and other bodies. After all, Members on this side of the Committee support Her Majesty's Government in believing that high rates of interest form one of the most important elements in the Government's anti-inflationary policy. If that policy is to be applied, then it must be applied over-all.
Why should the new town corporations be exempted? If it is right to exempt new town corporations, why not also exempt the entire range of local authority housing? If one exempts the whole range of local authority housing no doubt the hon. Member for Fulham (Mr. M. Stewart) and the other educationalists on the opposite side of the Committee would

like education as well to be exempted from the application of high interest rates. I am equally sure that the right hon. Member for Huyton would take the argument a stage further and advocate exemption for a great deal of industrial building, except, of course, his cherished petrol pumps, cinemas, and so forth.
It is because the Government, supported by hon. Members on this side of the Committee, want above all to protect the currency and stop inflation that we are not prepared to give our support to the Amendment.
One thing that has been mentioned in the debate and which the Committee should bear in mind is that there is already a subsidy for houses built by the development corporations which amounts to £32 a year per house. If we were to accept the Amendment and give preferential rates of interest to these corporations, it would mean an additional concealed subsidy in addition to the subsidy which is already paid.
There is another point which requires careful consideration. It has been said repeatedly tonight that the present rate of interest paid by these corporations is 6¾ per cent. That is quite true. It is equally true that the average rate of interest which these corporations are paying over their indebtedness as a whole is nothing like 6¾ per cent. It is more like 4½ per cent.

Dr. J. Dickson Mabon: Would the Parliamentary Secretary say what the amount of the additional concealed subsidy would be if the Amendment were accepted? What is the figure? We have not had it yet in the debate.

Mr. Bevins: Clearly, the amount of the concealed subsidy would be the amount of the borrowings made by the development corporations at a rate of 3¾ per cent.—in other words, the difference between the current rate of interest and the interest written into the Amendment. It would be a substantial figure.

Dr. Dickson Mabon: What is that figure?

Mr. Mitchison: Cannot the Minister tell us for how long this rate of interest will go on? Cannot he give any indication at all of what the Government's policy is in these matters?

Mr. Bevies: I have already said that the average annual rate of borrowings is of the order of £35 million a year. The present rate of interest chargeable is 6¾ per cent.; the rate of interest suggested by the hon. and learned Member is 3 per cent., and if he would care to multiply £35 million by 3¾ per cent., he will get the correct answer.

Mr. Mitchison: With all the resources available in the Department I expect these multiplication sums to be done by the automatic calculator, or whatever the hon. Member keeps at the Ministry.

Mr. Bevins: Had it been the intention of my right hon. Friend to accept the Amendment there would have been some sense in providing the figure to the Committee but, as I have already indicated, we have no such intention, and the figure is therefore of no importance.
It has been suggested that the rents of houses let by the development corporations are higher than the general level of rents charged by local authorities throughout the country. That is because none of these development corporations has the advantage of owning large numbers of pre-war houses. But it is the fact that although rents are relatively high in the new towns, the corporations still have long waiting lists of applicants who are prepared to accept the offers of houses in the new towns. That is so because of the, amenities and the condition of the houses which have been constructed in the new towns.
I end on this note. The Government's policy of dear money clearly forms part of their policy to protect the currency and put a stop to inflation. If we were to fail in that, housing and many other services would suffer in the process, and we do not intend that to happen. I therefore invite the Committee to reject the Amendment.

Mr. Mitchison: We have had a very interesting debate. I opened it with quite a short speech, but we have had such interesting comments from hon. Members opposite that I think the time has come to go rather more thoroughly into the question raised by the Amendment. There seems to have been a little misunderstanding about the matter. I even doubt whether hon. Members opposite have read some of the new town reports

about which they have been talking. I therefore propose to deal shortly with some matters of principle and then to examine as best I can what was the position of the new towns as at the end of March, 1957, when these reports were made up.
First, I want to thank those hon. Members opposite who, with such distinction, represent for the moment these new towns, for the speeches that they have made tonight. I can assure them that we shall study those speeches with care and will take the greatest trouble to bring them to the notice of the persons they represent in the new towns. Their contributions to the debate have been very valuable. [HON. MEMBERS: "Hear, hear."] I am glad to hear them applaud. It is quite right that they should. Their views are most interesting and valuable. They illustrate a philosophy which I feel certain will appeal to their constituents, and I am, therefore, helping them by promising them the study and circulation which their speeches deserve.
I am sure that they will not grudge me a little time. They have taken some. Let us proceed to go into this matter with a little care and attention. The speech of the Parliamentary Secretary was a trifle short and, at points, almost curt. Let us begin by examining the principles at stake. I agree that the Government have got the country into a sad financial mess; that their Election promises about keeping down the cost of living and, indeed, reducing it, have very obviously not been fulfilled, and that, as part of a belated policy, they are now trying to do something or other to deal with inflation somehow. After all, there will be a General Election one of these days. That point has been repeatedly made by Government supporters.
I concede that the Government at long last are trying to do something, not very effectively and rather late in the clay, about some of the promises that the Tory Party made at the last Election. It is against that background that we have to consider the position of the new towns. I should be out of order if I went into financial questions, but I noticed some financial generalisations from the Government benches which attracted my attention. It would be very pleasant to have a long discussion on them.
When we get to the ordered atmosphere of the Finance Bill it is the practice of Chancellors of the Exchequer, when dealing with a serious Amendment, to give information about the cost of it. I was distressed that the report of the Ministry of Housing and Local Government was apparently unable to do this. It only presented us with an exceedingly complicated multiplication sum. I have long taken the view that the Ministry keeps somewhere in its recesses a mathematician of great eminence who is required for the purpose of the Exchequer equalisation grant, and so on. I was disappointed that the Ministry had not turned this gentlemen on to do the sum.
Be that as it may, we can take it as certain that if we increase the rate of interest for borrowing by these corporations the money will go somewhere. In borrowing, the money goes to the development corporation from the Treasury. If we reduce the rate of interest for the borrowing of the development corporations, some money passes, this time a lower one, from the Treasury to the development corporation. This is said to be a hidden subsidy. That is a fascinating proposition. I had a suspicion that some Government supporters who used that phrase, including the Parliamentary Secretary, had not considered who was being subsidised and for what purpose. The Parliamentary Secretary is rather accustomed to using the phrase because he has used it on and off about all sorts of things. I touched on this question in opening, and before we come to the detailed examination, as I hope to do, of the difficulties of the corporation, I might examine the questions whether it is hidden and whether it is a subsidy.
It is obvious that if the change in the rate of interest constitutes something different, then the fact that there is a high rate of interest is not widely known. I wonder whether that really is the case. The figures are published and orders are made, but I have a suspicion from time to time that some of the inhabitants of the new towns think that there is some connection between the high rate of interest charged by the Government and the very high rates that they have to pay. Being quite intelligent people, they reach the conclusion that if that rate of interest were reduced the rates that they have to pay would be reduced too. I cannot see that there is anything very hidden in that.

Sir I. Fraser: I thank the hon. and learned Gentleman for helping us so much to understand this matter. Could he just make an elementary point clear to me? If we let a man live in a house at less than the economic rent, who pays the difference?

Mr. Mitckison: The payment comes from the same source as the housing subsidy which is at present allowed for houses in development corporations. That is a very interesting point indeed.

Mr. Ellis Smith: Who pays all the people the hon. Member for Morecambe and Lonsdale (Sir I. Fraser) belongs to?

Mr. Mitchison: I should like to do what I can to help the hon. Member for Morecambe and Lonsdale (Sir I. Fraser), but a little later on in my speech, perhaps in about twenty minutes' time. It will cone in then. For the moment, let me keep to the one point I was elaborating: Is it really hidden?
9.45 p.m.
It is quite true that the people who live in the new towns, even those who vote for the Tory Party, do not always quite understand matters like the effect of rates of interest on their rents. I think it is up to us—hon. Members opposite have been doing their best to help tonight—to publicise the facts of the matter so that if there were any danger of these things, which after all are open to knowledge, being hidden, they should be open to discussion in Parliament. As I said, constituents of hon. Members opposite will read with great interest the speeches that they have made in support of the proposition that rents ought to be very high in new towns. That after all is the proposition they were supporting. I feel certain that those who pay the rents will show a due amount of gratitude for the words those hon. Members expressed tonight.
The next question is, is it a subsidy? This involves some very interesting philosophical questions. At first sight one would not think that if money was loaned by the Treasury to a development corporation an alteration in the rate of interest charged for that purpose could constitute a subsidy. It seems to me that it can only do so if one is prepared to examine whether there is or is not a true rate for the Treasury itself to get


its money. When we consider how the Treasury does get its money we come to some questions which I am afraid will take me a few minutes to develop, but which are related to the question of whether this is a subsidy.
At first sight we all agree that it is merely the rate of interest paid on a loan. Is it the case that the Treasury always borrows any money it loans to development corporations? Is it the case that if it does borrow it borrows from sources which themselves borrow from somewhere else? If they do borrow from somewhere else, does that source in its turn borrow from some other place? In the long and last resort what is it—I am glad to see that the hon. Member for Eastleigh (Mr. D. Price) wants to ask a question. He is a financial expert. Is he going to ask one? I thought I saw him moving uneasily.

Mr. D. Price: Every time the hon. and learned Member for Kettering (Mr. Mitchison) speaks one moves uneasily.

Mr. Mitchison: I am very glad to hear that it was only one of the hon. Member's usual uneasy motions. I trust I shall not agitate him into too much movement tonight. I would be indeed sorry to do so as he might find sleep or absence preferable.
Let us consider again what is the real, the economic, rate of interest corresponding to the economic rent of which we have heard something tonight. I think we have to start by recollecting that the change in the rates of interest of which we are complaining is entirely due to the Government themselves. That is to say, it is Government policy which has caused the rise in a rate of interest, which was always under 3 per cent. when the Labour Government were in, to its present level for the purposes of borrowing by new towns of 6¾ per cent. The Government have changed the rates of interest with bewildering frequency. If we look at the accounts of the new towns we find the different rates at which the new towns have had to borrow. It is now 6¾ per cent. and the particular jump of which I was most complaining was a jump from about 5¾ per cent. at the time when the period of these Reports came to an end to its present level.
That is not the whole story. They have risen for a number of years and we find

in every one of them, not only a steady rise, but constant changes in the rate at which they borrowed. Some of these new town corporations set out these figures in detail and others do not, but I think that the general principle is clear from any of the reports. If we look at the figures for Aycliffe we find that they are interesting. We are considering whether there is a subsidy, that is to say whether there is some rate of interest below which a loan becomes a subsidy in some form or another.
For Aycliffe we begin with the period under one Labour Government or another up to 1951 during which the rate of interest was 3 per cent. We then find that the rate rose to 3¾ per cent. The frequency of these changes is remarkable. Between 8th November and 8th February, 1952, the rate was 3¾ per cent. For a very short period between 9th February and 31st March it was 4¾ per cent. In 1953 and until 19th October, 1954, it was 4¾ per cent. From 20th October, 1954, to 3rd June, 1955, it was 4 per cent. Later it was 3¾ per cent. and from 1st March to 8th July, 1956, it was 4 per cent. Then there was quite a short period from 9th July to 12th August at 4¼ per cent., and another period from 13th August to 6th September at 4½ per cent. There was a period at 5 per cent. from 7th September to 16th January. We then have the figures continuing to the end of the period to which these reports relate.
It appears to me that if we are to consider the question of a hidden subsidy, we see that the true rate of interest, any variation from which in a given direction would constitute a subsidy, was itself varying with extraordinary frequency for these short periods to which I have been referring. I am, of course, still on the general principles. I should have thought, in the circumstances, that it was quite unreal to describe as a subsidy the lending of money at a certain rate.
I would go this far with right hon. and hon. Members opposite—that it may be that they have introduced what they regard as some reality into the conception of the astronomical rates of interest which are ruling at present as a result of their policy and that, having regard to it, we must consider the question whether it is right and proper and serves a good social purpose that money should be lent at a lower rate than that prevalent for other purposes.
So much for Aycliffe, but before I leave the question entirely I should like to take the next development corporation in this book, which is Basildon, and look for a moment at the figures. I am sure that right hon. and hon. Members opposite who treated us to such interesting speeches, collectively at some length, will not grudge me an hour or so to develop the matter. [HON. MEMBERS: "Hear, hear."] I hope that I may have a hearing for these matters. I am very glad of applause—indeed, I welcome it very much—but we are engaged on a most serious matter which affects considerable sums of public money and a large proportion of the population of the country, and it is right that we should examine it, even on this Amendment, with close attention.

Mr. D. Price: The hon. and learned Member says that we are dealing with a lot of public money. Recently he objected to this being called a subsidy. Will he explain how public money used in this sense is anything other than a subsidy?

Mr. Mitchison: I have not reached that part of my speech and I will develop the matter more fully later, but, if I may anticipate for a moment, it is public money both in the hands of the lender and in the hands of the borrower. That seems to me to constitute a real difficulty when one is considering whether this is a subsidy, but I am very glad to have provoked the hon. Member for Eastleigh beyond his usual mere uneasiness, because it is interesting to have his financial views—he told us he was a financial expert—on a matter of this sort. Let us continue for a moment. I am taking this only as an instance. There are several reports to which we shall have to refer later.
To take Basildon as an instance; I want to consider whether there can, in the circumstances, be said to be a subsidy. I will not go right back, because one does not want to take up time unduly and there are many considerations to digest. We may note that while the Labour Party was in office and the new towns were started, they had to pay only 3 per cent. After that, their rates of interest increased to 4¼ per cent. Does the hon. Member for Galloway (Mr. Mackie) wish to interrupt?

Mr. John Mackie: The hon. and learned Member must have misunderstood my gesture. I was cautioning my hon. Friend behind me, the hon. Member for Ormskirk (Mr. Glover), not to interrupt.

Mr. Mitchison: I am much indebted to the hon. Member. I appreciate that. I trust that his hon. Friend will be able to resist what is, no doubt, an almost overpowering temptation.
I do not think that we need go through the reports in very great detail—[HON. MEMBERS: "Go on."] The position is that a sum of about £16 million has been advanced to the Basildon Development Coropration, which differs from the other corporations in that some of its rates of interest are slightly different from theirs. With the assistance of the uneasy Member opposite, I want to look merely at the financial aspect of the matter to see whether there is any question of a hidden subsidy.
I come to the question which has interested several hon. Members opposite and which has interested me: if it is a hidden subsidy, exactly how does it work? I have already said—and I would not for the world repeat myself—that it is money advanced from the Treasury to the development corporation. It results in the construction of a number of factories in the new towns, in public works and, lastly, in the type of new town development with which we are particularly concerned tonight, housing.

Dr. Dickson Mahon: Does not my hon. and learned Friend agree that the debate is getting somewhat out of joint? He is referring to Basildon, but the hon. Member for Billericay (Mr. Body) who represents Basildon is not present. Would it not be more desirable for my hon. and learned Friend to direct his attention to those new towns which are represented by Members who are present and who would appreciate and answer his points? Otherwise, I fear that the debate might become somewhat unreal.

Mr. Mitchison: I would not for the world allow any element of unreality to creep into our discussion. It would be a pity to lower the standard after the reality apparent when hon. Members opposite were addressing us. At the same time, I cannot run the risk of boring the Committee—

Hon. Members: Go on.

Mr. Glover: The hon. and learned Member, very learned tonight, would keep the debate topical, as his hon. Friend the Member for Greenock (Dr. J. Dickson Mabon) suggested, if he referred to the new town of Cwmbran in South Wales, because I see that the hon. Member for Pontypool (Mr. West) who represents that new town and who sits on the hon. and learned Member's side of the House has already gone home.

Mr. Mitchison: I referred to that in a previous speech, and so did my hon. Friend the Member for Pontypool. I am afraid that the hon. Member was not here. I thought that I would postpone my reference to it for a short time until we had dealt with some other aspects of the questions raised in the debate.
We have reached the conclusion that a hidden subsidy is due for erecting certain buildings and that those buildings are at present the property of the development corporation. They will, of course, remain the property of the development corporations for some time, and then they will become, if we on this side of the Committee have our way, the property of the local authorities. That was indeed the course which hon. Members opposite at one time urged fervently in the name of democracy, but some other consideration, financial perhaps, I do not know what it is, has moved them now to suggest that these new towns should ultimately go back to the agency which is representing the Government.
What I find very hard to understand is this. How can there be said to be a subsidy from the Government to the development corporations which have no other financial existence than that dependent on their borrowings from the Government; and yet again, if hon. Members opposite are to have their way, how can there be said to be a hidden or other subsidy in the expenditure of money borrowed from the Treasury on property which is going at the end of the day to become the property of a Government agency?
We are all aware, because we were told so by the Minister without Portfolio in another place, that the object of this Government agency is to sell this property. It seems to me perfectly conceivable in business matters—and in this I would always bow to hon. Members opposite,

although I have some experience myself—for a company which was embarking on a commercial venture and using a subsidiary company for the purpose to lend money to that subsidiary company at an abnormally low rate of interest and expect to be recouped from it at the end of the day.

Sir I. Fraser: Who pays the difference?

Mr. Mitchison: That is what I am trying to answer, but I am afraid that it takes me a little time to make it clear. The hon. Member must have some patience with me if I do it slowly; I am doing my best.
To return to the case that I was putting, supposing we have a company which has a subsidiary company and it lends money to that subsidiary company and the subsidiary company uses it on the development of a large piece of land, five miles of fertile land—and the right hon. Member may remember what happened to Kublai Khan when he was doing a little bit of town planning; I suppose he squared the Minister of Agriculture about it—is it a subsidy that the company lends to its subsidiary company at a lower rate of interest with the intention that the subsidiary company should ultimately sell the property at a profit? I cannot see it. It seems to me that there might well be a sound case for it in the new towns as there may be in the hypothetical case I was putting earlier. Again I come to the conclusion that the use of the phrase "hidden subsidy" really has complete unreality in it and does not, in fact, represent the true condition of affairs.
The next question is this. Even if it were a hidden subsidy, or to put it in different terms, whether or not it is a hidden subsidy, is there any good reason for allowing a rate of interest lower than the usual rate of interest in these particular dealings with new towns? That, of course, it seems to me, is a social question. I heard one hon. Member opposite who found it impossible to draw a line between investment and social investment. I fully appreciate his difficulty. It is one which has always haunted the Tory Party. It seemed to them inconceivable that investment could have a social purpose or any purpose than a profitable one. It is for that reason that they found it so difficult to understand the conception of a social investment.
Let me ask them to consider what is the nature of these new towns. I hope to be able to persuade them in the course of the next half hour or so that they really are a social investment. Having done that, we shall then, I hope, have to consider the effect which these high rates of interest are having and the corresponding effect which the rate of interest proposed by the Amendment would have on the development of that social experiment.
The social experiment, as I understand it, had two original purposes or, rather, two aspects of what was perhaps fundamentally the same purpose. I would ask hon. Members to bear constantly in mind that all I am going to describe now was done when the rate of borrowing was 3 per cent. First of all, these new towns were built round about London for the purpose of relieving the surplus population that London was unable to house. They were, of course, an investment in a sense, but it seems to me that the purpose of doing that clearly is a social purpose and it is not really inappropriate to call that a social investment.
That went on for some time, and then they were used for another purpose. They were used to house and to make communities for industrial populations in places where there were some special difficulties. If I may mention Scotland, but only for a moment, Glenrothes was connected with mining. In the same way, Corby, which I represent, was connected with iron and steel. Cwmbran had the industrial and social purpose to which I referred in the last short speech that I made at the beginning of the debate and which I would not for a moment wish to repeat now. Therefore, I will say no more about Cwmbran than that. Aycliffe again is closely connected with a trading corporation.
That batch of new towns was not intended primarily for the relief of housing difficulties in the big towns but for the solution of the problem relating to industrial settlement of a special kind. That went on for a fairly long period. Corby was actually the last of the new towns. I think I am right in saying that that was in 1950, towards the end of the period of the Labour Government. Then further efforts were made to deal with the problem of surplus population. East

Kilbride, for instance, was built in Scotland, and we all know how difficult is the housing problem of Glasgow. Further additions were made to the new towns built around London. That was one purpose of these new towns.
There was another purpose which seems to me to illustrate even more clearly the social character of the investment, and that further purpose was to create in these places not merely a collection of housing estates, as one of them, complaining of Tory policy, now says it is—that is Basildon; and I am referring to the evidence given to the right hon. Gentleman's adviser on these matters before the Public Accounts Committee—but a new town that would house people of all types and conditions of income.

Mr. Ellis Smith: Mr. Ellis Smith rose in his place and claimed to move, That the Question be now put.

Question, That the Question be now put, put and agreed to.

Question, That the proposed words be there inserted, put accordingly, and negatived.

Motion made, and Question proposed, That the Clause stand part of the Bill.

Mr. Mitchison: I have some observations to make on this matter, and they again involve the question of the social investment. We are being asked, of course, to provide money under the Clause for the further extension of the new towns. We may be obliged to provide it at a somewhat high rate of interest, and it is, therefore, expedient to see what the effects of that high rate of interest are on the social experiment which we have to consider.
In an earlier debate on the Amendment which the Committee has just negatived, I referred to the social character of the experiment, first in relation to the population of our conurbations, London and others, which the building of the new towns was intended to relieve. Since I am very anxious not to repeat myself even in a different part of the discussion, I feel that it would be quite wrong to repeat those observations now, and I trust that they remain sufficiently fresh in the memory of hon. Members. But I have not been able fully to develop the question of the community life in these new towns, and for that, of course, we depend on their reports.
The reason this arises in connection with the Bill is that we are asked to provide new money for them with the knowledge that that money is being lent, at present, at 6¾ per cent., the Committee having just rejected an Amendment that it should be lent at a lower rate. It seems to me that, before we pass this Clause, we ought to consider first of all, what is the object of the new towns, and, secondly, whether the money provided on those terms, which are the current terms, is likely to enable them to carry out their social purpose.
I can state the community purpose, if I may so describe it, quite shortly. It is, of course, to provide factories, to provide houses, to provide the services required for that purpose, and to make the people who come to live and work in the place a community representative, broadly speaking, of all types of people and ranges of income in the country.

Mr. Joseph Slater: My hon. and learned Friend referred to Aycliffe, which happens to be in my constituency. I wonder whether he is aware that, owing to the interest charges now imposed on this new town corporation, we are finding that nearly all the people there have to go out to work in order to meet the high rents in the new town.

Mr. Mitchison: I am most grateful to my hon. Friend for bringing up to date the information which is found in the Aycliffe Report, which does show, as his statement confirms, how unlikely it is that the money provided under these terms which we are being asked to vote for in the Clause will enable the development corporations to carry out the duties which the Act of 1946 put upon them.
10.15 p.m.
Incidentally, will not the provision of this money, as the passing of the Clause would allow, subject to the next Clause being passed, create more social harm than social good? If those are the terms prevalent in Aycliffe—and Aycliffe, though perhaps the worst case, is not exceptional—the question then arises whether it is worth while for people to move to these new towns.
Grateful though I am to my hon. Friends for their continued attention, I think it fair to warn them that I may go on for quite a long time and that I

never suffer from draughts in my back, if I may put it that way.
Turning for a moment to the question whether this money will prevent the development corporations from carrying out the social purpose enjoined upon them by the New Towns Act—I refer now to the community purpose—I begin, as is right, with Aycliffe. On page 5 of the Tenth Annual Report of the Aycliffe Development Corporation, I find the following passage:
Almost the whole of the Corporation's capital expenditure has been devoted to the satisfaction of what may be termed broadly social needs in a county where these have suffered gravely and have accumulated over the last half century.
I am sure my hon. Friend will agree with that and that even hon. Members opposite will agree that as a statement of history, that is fairly accurate. That is Aycliffe.
Now, we come to the expenditure which, by passing the Clause, we are being asked to continue. The report continues:
This reflection might well be the justification for the enlightened policy of Parliament in relation to housing subsidies during the last decade.
I pause there for a moment to remind hon. Members opposite of the complete inconsistency of saying that when money is lent at a specially low rate of interest, it is any different from giving a housing subsidy, and to remind them that a housing subsidy is itself specially given to new towns.
The Aycliffe Development Corporation states:
The alternative could be an increase in rents of approximately 13s. per week and this in a region accustomed to abnormally low rents.
In those circumstances, it becomes rather doubtful whether the granting of further money will help the statutory purpose and the social purpose of these new towns.
The report continues:
The inflationary sequel to this"—
I suppose it may be said that by granting further money, if that was the result up to the end of March, 1957, we may, contrary to the Government's professed policy, only be increasing the existing inflation—
seems unquestionable and entirely divorced from political argument or ideology.


The Aycliffe Development Corporation seems to regard it as quite true—even truer on that account—but inflationary in this respect. To continue the report:
However, with the help of the subsidy and by the prosecution of a sound and consistent rent policy … the Revenue account does show a small surplus, and with normal luck this state of affairs should continue.
This, hon. Members will remember, is in respect of the previous money, and not at the rate of interest which is to apply to the money we are now being asked to continue in the new towns.
I want to read another passage from the Aycliffe Corporation's Report and then proceed to some of the other new town reports. The Aycliffe Corporation says on page 6 that:
It will be noted that during the year the tempo of house-building was appreciably reduced. This was the Corporation's contribution to the Ministry's expressed wish for financial relief, but in any case it was not thought prudent to borrow more than was strictly necessary and to pay 5¾ per cent for the privilege.
At the moment we are being asked to contribute towards Aycliffe and other development corporations an additional sum of new money at a higher rate of interest from their point of view than that which was prevalent at the time that this report was written. Therefore, it seems exceedingly doubtful whether further advances on this line will assist Aycliffe to perform its statutory duty.
Still on Aycliffe, I quote from the report:
It was the Corporation's hope that the new rents could be stabilised for at least three years, and in spite of further increases in the rate of interest and in wages during the year, this aim may still be achieved due to the stowing down of housebuilding during the year in consequence of the 'cuts' made in capital expenditure. The recent reduction of one-quarter per cent. in the rate of interest was very welcome and it is hoped that this is a forerunner of still further decreases.
That was written in the summer. The report goes on to the end of March, 1957, and, so far from having further decreases, the corporation has had further increases.
If a rise in the Aycliffe rents, as the corporation indicated, would make its job impossible, it is perfectly clear that further advances at the rate of interest at present prevalent and at the rate, in view of the Committee's decision tonight, we must take to apply for the future, will certainly not help the corporation to carry out its

duty as a new town corporation. It is because of the rate of interest that the Committee has just accepted that I feel very doubtful indeed whether we ought to accept the Clause, having regard to the difficulties which it will cause to the new town corporations.
Let us proceed from Aycliffe and examine the position in some of the other corporations. The Basildon Corporation, for instance, says at the beginning of its report that it has been a year of considerable difficulty:
due mainly to higher loan charges and rising costs. This Corporation have unfortunately met the high interest rates at the peak of their industrial development, when the industrial progress has demanded a heavy housing programme. While every endeavour has been made to maintain high standards of construction and design, it cannot be denied that the financial situation has demanded economies in detail, which cannot be welcomed in view of the long-term nature of New Town development.
The corporation is saying that the long-term nature of new town development, which is the purpose for which it exists, is being hindered rather than helped by advances of further sums of money at the rates of interest which at present apply, and continue to apply to those advances which we are now asked to sanction.
So much for Basildon. I want to make this point perfectly clear, so let us take Corby and the development corporation which I represent. The corporation's rather short report says:
Rising costs of building, due mainly to increases in interest rates, have continued to cause anxiety, and rents of dwellings now being built are inevitably higher than of those built in earlier years.
Of course, this is the result of the dealings of the Government with the previous advances made under this Act. In those circumstances, one wonders whether we are really right to pass this Clause, and to make further advances on the same lines with what appears likely to be an even worse result. After all, these reports were written at a time when the rate of interest was lower that it is now.
Turning to Crawley, we find, again, the same sort of difficulty. The Crawley Corporation says, and this, of course, is with reference to the money which was advanced in the past and which we are asked to advance in addition now in increasing sums:


Whilst high interest rates generally tend to curtail or postpone capital investment, a Development Corporation at the peak of its programme is inevitably committed by the impetus arising from investment completed and in progress. To this extent higher interest rates must have an inflationary tendency.
Of course they have an inflationary tendency, and one wonders in those circumstances whether the Government are really following out their own policy when they insist, as they do, on charging these high rates of interest in respect of the money that we are now asked to advance. Cwmbran I referred to in the short speech I made earlier, and as I am very anxious not to repeat myself in any way, I think that we might leave Cwmbran out on this occasion.
Let us consider what is happening in Harlow. This is exactly the same thing, and makes one wonder whether we are right to pass this Clause. At the end of its report, the Harlow Development Corporation
… regrets that when rates are high it is obliged to borrow for 60 years and would welcome discretion to follow normal commercial practice and borrow for short periods when rates are unfavourable.
That follows the statement that the corporation has had difficulty with higher interest rates and, of course, again raises the question whether, assuming, as appears to be the case, that further money is required for the development of new towns, it is really advisable that the money should be advanced under the provisions of the 1946 Act, or whether the Government might not consider reviewing their whole financial policy in relation to the new towns and make advances on wholly different terms. Indeed, one development corporation that I shall come to in a minute or two does make a suggestion of that sort.
Having dealt with Harlow we come to a point—again relevant, it seems to me, as to whether we should sanction these advances—in the report of the Hemel Hempstead Development Corporation. It points out the extreme difficulty of the loan burden in relation to the amenities which it would like to provide for the town, and, speaking more generally, says that:
The effect of higher interest rates on borrowed money and the general rises in building costs which contributed to the problems of the year, will be more noticeable in 1957–58 and 1958–59, when construction put into the

programme during 1956–57 will become available for occupation.
That, of course, is a difficulty, and it is a difficulty relating to the additional advances with which we are called upon to deal tonight. That report goes on to say:
Higher costs produce problems of design, it rents of dwellings are to be economic"—
and I think that there, "economic" means economic in relation to the rate of interest charged—
and yet remain within the reach of the residents for whom they are built.
The Corporation points out that it did its best to make economies, but finally it was decided
… to delay a number of schemes and to accept a lower figure of completions for the ensuing two years.
10.30 p.m.
Having regard to that sort of thing, there arises in connection with the passing of this Clause a further question—whether all this money is actually to be spent by the development corporations. I earnestly hope it is, because they require to spend it, but, having regard to the high rates of interest, it is very difficult for them to make the fullest use of it. So much for Hemel Hempstead.
I turn for a moment to Peterlee. This development corporation is in a slightly different position. It is in the North of England and caters for a level and type of population different from that of some of the new towns round London. Here again—this relates to the advances that we propose to sanction tonight—we find this:
The impact of high interest rates in Peter-lee is particularly noticeable in the light of the low level of rents charged in the surrounding district, combined with the tradition of free or extremely cheap housing.
That is to say, when we get a Tory Government advancing money to development corporations, the result is rents which compare very unfavourably with those which have prevailed in council houses and others previously.
These hopeful people add
The Corporation is pleased to note however that recent trends indicate the possibility of an early return to lower rates of interest, the effect of which will enable the Corporation to return to a normal housing programme, at the same time giving a further impetus to ancillary development, particularly in the fields of commerce and industry.


They were too hopeful. Clearly, that report was written before the rise in the Bank Rate and the rise in the rate of advances to these people was put into force.
Lastly on this point we come to Stevenage. There is a passage in which the Stevenage Development Corporation regards the whole problem of finances as one for the Minister's "immediate and earnest consideration." I referred to this passage during the Second Reading, and, anxious as I am at all costs to avoid any repetition, I should not like to repeat it again, but I earnestly trust that the right hon. Gentleman, having now had a further opportunity of considering the matter, has given it further consideration, if not "immediate consideration," for the report was written very many months ago and the corporation wants a national policy aimed at the reduction of interest rates and costs. That is just the national policy which the Tory Party promised at the General Election and which the Government have not carried out. So much for that part of the Stevenage report.
At the end of the report it is put even more succinctly:
The whole question of the financing of this great social and economic experiment of the New Town"—
not just Stevenage—
in the corporation's view, needs re-examining. Until this is done one sees but little hope of stabilising, certainly not of reducing, rents; and high rent levels appear to the Corporation to constitute the most dangerous threat to the prosperity of the town.
That is nearly but not quite the last of the reports, and perhaps we may accept that as a conclusion. I cannot expect the right hon. Gentleman to reply at any great length to the numerous points that I have raised. I regret that the exigencies of the situation and the feeling that I must not become too tedious to the Committee prevent my going on, as in many ways I should have liked to do, for another two or three hours. It is a fascinating subject. I have done this only out of gratitude and in return for the very valuable contributions that we have had from some back benchers opposite. I could not resist—without, I hope, any undue arrogance—a certain feeling that some of them needed a little bit of a

lesson. I have been endeavouring to give it.

Mr. Slater: I am indebted to my hon. and learned Friend the Member for Kettering (Mr. Mitchison) for drawing the attention of the Committee to that new town in my constituency, Newton Aycliffe. I am very disturbed because of the action the Minister has taken affecting the new towns. It indicates what is to happen to the new towns in the next year or two.
Because of the high interest rates restrictions are placed on the development corporation, and because of those the corporation has had to take action which will result in many people not having the opportunity to take up residence there who are most desirous of doing so. The corporation will not be able to carry out the housing programme which was expected to be carried out because of the demand for houses from the people desiring to go to live there.
My hon. and learned Friend referred to the trading estate in the area. The new town was set up in the first place to provide accommodation for the employees going to work on that trading estate. People from all parts of the country, from the east, south and west, have come into that new town, and many have had to leave again, and to return to the places from which they came, because of the high rents which have been charged because of the high interest rates. Distress has been caused—and I share it—by the population limitation of 11,500 the Minister has imposed upon the corporation, with all the loss of opportunity it means for the area, and for the people who want to go to live there, and I hope sincerely the right hon. Gentleman will have second thoughts upon the matter.
On the trading estates are firms which are starting new policies whereby they hope to increase their production. For instance, there a firm which expects to set up new engineering works there, which will absorb between 300 and 500 extra workpeople. They look to the development corporation for houses to live in, but because of the Government's policy and the high interest rates those houses will not be there for the people of those firms on that trading estate who want to develop their production and enter, or


increase their business in, the export market and so give us all benefit of the labour and skill of their workpeople.
I sincerely hope the facts and arguments which have been brought out tonight by my hon. and learned Friend about Newton Aycliffe will be fully considered by the Minister. I hope the Minister especially in the light of his visit to Newton Aycliffe, will have further thoughts about that areas's circumstances.
He cannot find a better site or a better area of development than that among all the new towns built in this country. He can choose anywhere he likes: he will not find a better sited town than that, or one which has been better developed. I hope he will bear in mind that the young residents, young married people, find it hard to meet the high charges for rents made necessary because of the high interest rates. He ought also to consider the social facilities there, and those provided by other local authorities in rural districts and municipalities. In view of what has happened and the points that have been brought up, I repeat the hope that the Minister will have second thoughts about the new town which he had the privilege of visiting.

The Minister of Housing and Local Government (Mr. Henry Brooke): I am glad to have the opportunity of saying a word in reply to the hon. Member for Sedgefield (Mr. Slater) about the new town of Newton Aycliffe, in which he naturally has a special interest. I had an extremely happy day there recently, and I congratulate him and his constituency on having such a delightful new town. I can assure him that the one thing that I want to do is to contribute anything I can towards the success of Newton Aycliffe and the happiness of the people living there. When I visited it nobody made representations to me about any large percentage of the people who had come there finding it necessary to leave again owing to the high rents; indeed, one of the satisfactory features about the new towns is that in spite of the doubts which were expressed in the

early days as to whether people wanted this kind of new town development, the proportion of people who for one reason or another have left the new towns after arriving there has been astonishingly small.
I have said that I think that the development corporation should stop building when the population of its new town has passed the population figure of 11,000. I assure the hon. Member that I shall take account of what he said, because I certainly want to ensure that Newton Aycliffe is a successful community and a good sort of community for people to live in. He and I are at one on that point.
I was beginning to think that the hon. and learned Member for Kettering (Mr. Mitchison) was making a rule that his speeches in the House or in Committee must never fall short of sixty-six minutes. At any rate, I trust that at the moment there is no great issue between us, because the Clause enables the new towns to proceed beyond the point when advances towards new town development will reach the figure of £250 million. Most fortunately, for a number of years there has been unanimity between the parties that this new town development should go on, at any rate until the existing towns are completed.
The question that we are now discussing is not what the rate of interest should be but whether the Clause should pass. If it does not stand part of the Bill, as the hon. and learned Member realises, new town development will come to an untimely conclusion not far on in 1958. I believe that he would regret that as much as everybody else, and I hope that he will therefore decide not to divide the. Committee.

Question put and agreed to.

Clause ordered to stand part of the Bill.

Clauses 2 and 3 ordered to stand part of the Bill.

Bill reported, without Amendment; to be read the Third time upon Monday next.

Orders of the Day — INDIA (FAMILY PENSION FUNDS)

Motion made, and Question proposed,
That an humble Address be presented to Her Majesty, praying that the Government of India (Family Pension Funds) (Amendment) Order, 1957, be made in the form of the Draft laid before this House on 20th November.—[Mr. Alport.]

Debate adjourned.—[Mr. Oakshott.]

Debate to be resumed upon Monday next.

Orders of the Day — COAL (PRICES AND QUALITY)

Motion made, and Question proposed, That this House do now adjourn.—[Mr. Oakshott.]

10.44 p.m.

Mrs. Jean Mann: I want to raise the question of coal overcharging, with particular reference to the unsatisfactory reply I have had every time I have raised the question.
There is not a newspaper that does not constantly receive letters from people about stones in the coal, and these writers to the editor always ask what they can do about it. There is never a public relations officer who can reply to these letters. No one seems to know what to do when receiving bags of stone instead of coal.
I would know what to do if I got sand in the sugar or lead in the tea; why have the consumers of this commodity, coal, which is so very expensive and the price of which is a real hardship, especially to old-age pensioners, no protection? It is conspicuous by its absence. I have drawn the attention of the Paymaster-General to this matter time and again, and I have got no satisfaction. In fact, I have been guilty of mentioning that the reply showed great ignorance, I have an opportunity now to prove it.
I got a reply in October. I had asked that the Bradford experiment be extended throughout Britain. I was told that the Minister would now make inquiries into the success or otherwise of the Bradford experiment. I have the "Monthly Review" of the Institute of Weights and Measures Administration

in my possession. It is the October issue containing a report of the Institute's June conference. As long ago as June, the Bradford inspector, addressing this conference, said that he had recently had an opportunity of discussing the results of this experiment with an official of the Ministry of Power who had originally opposed the experiment.
On this occasion, the official admitted that he had always thought that inspectors of weights and measures could do their work better than Ministry officials, and went so far as to say that enforcement by the Ministry had never been and never could be more than a gesture. The Bradford inspector went on to say:
Since the price could easily be raised by £2 a ton and more by simple misdescription, the admission that present enforcement could be no more than a gesture was, in his opinion, staggering in the extreme. In the circumstances it was difficult to understand the Ministry's continued opposition to applications for similar powers from other authorities.
It is more difficult to understand why an official was sent early in the year, and why, more than six months afterwards, the reply should come from the Government benches that the Ministry was thinking of inquiring into it. The Ministry did not even know what its officials were doing. The fact is that they have not the slightest interest in whether consumers are paying Group 1 prices for Group 5 coal. They do not even know the difference between the grades; they are not at all interested. The Bradford experiment was conducted with a weights and measures inspector who has power to board a lorry and check any seller in regard to weight to see that there has been no underhand dealing and at the same time to check the correctness of price. Is it too simple to adopt that practice generally? Probably it would mean that a horde of officials would be dismissed, officials who appear to me to be doing nothing at all.
I spoke to one Ministry of Power official who told me he did not know the difference between Group 3 and Group 4 coal and asked, "Do you, Mrs. Mann?" I said, "No", but the inspectors of weights and measures, who are on the job, do know the difference. The conference report from which I have quoted points out that at one inquiry


about weight it was found that coal could have come from Group 4
whereas the consignment notes, which had been examined, were all marked Group 3, with a corresponding increase in price. Since then there had been many similar cases discovered in similar circumstances, which showed how well weight checks combined with group checks.
These men are already paid for checking weight; why are they not given power to check grade as well?
The Bradford inspector told the conference that
Compared with two prosecutions in the previous five years
under the Ministry's scheme
in two years since they had obtained the powers 40 prosecutions had been instituted, involving 277 informations and resulting in fines and costs totalling £4,500. Those figures did not include prosecutions under the Merchandise Marks Act for misdescription and other prosecutions for obtaining money by false pretences, but related only to the Retail Coal Prices Order.
I have been told that the Bradford system cannot be extended without some amendment of the Defence of the Realm Act. Weights and measures men I have spoken to take a very dim view indeed of that reply. I can understand an objection to an official being able to barge into someone's coal cellar, but that is not what we are asking. We are asking that they should check the grade while on the lorry checking the weight. I ask that the housewife should not be driven from pillar to post but that she can be told that when the inspector is on the lorry he can have a look at the coal. Surely her invitation to the inspector should not require a warrant.
Writers in the newspapers are saying that they are told to get their coal merchant to complain but that when they do so the reply is, "I have to take what I can get. "It is absolutely untrue; yet that reply is accepted by hundreds of consumers. I have examined the National Coal Board Report. I am astonished and disappointed that merchants do not complain to the Board. The Board says, "When a merchant complains, it enables us to trace the pit and possibly to downgrade the coal at that pit, or it enables us to give compensation coal." I quoted the Coal Board Report to my merchant,

but he said, "I have just got to take what I can get."
I therefore decided to take action myself. I knew there was some provision in common law that protected people from getting stone described as coal, from getting sand in their sugar or metal cuttings in their tea, and I wrote a letter to my merchant and to the Coal Board. As I was not sure which of them I should sue, I told them that I would sue them jointly and severally. Within two days four officials came along to see the coal and brought my merchant with them. They said to the merchant, "You did not complain about this" and he said "No". "But," they said, "two other merchants in this district complained and received compensation coal." I immediately asked if they had passed the compensation on to the consumer. Nobody knew. The Minister does not know if the consumer gets the compensation coal.
This is utter carelessness in connection with the dearest commodity that is coming into the house at the moment. I may say that I got my compensation coal. There can be no denying that it is not only in Bradford that people opt to be so heavily fined. Are we to assume that all the exploiters and the fiddlers with the grades of coal are in Bradford? I would hesitate to say that all coal merchants were dishonest. I know a great many honest coal merchants who probably have dishonest servants. Delivering bags of coal is not everyone's cup of tea, and sometimes to get the coal delivered a merchant has to take Tom, Dick and Harry. I have every sympathy with the coal merchants, and indeed I know some who do give compensation coal.
However, as was said at the Weights and Measures Conference, it is far easier to make something on the side
in regard to price rather than weight.
Another merchant, according to the Conference report, who had been approached said,
Others are doing it. I thought I might as well.
It is laughable to suggest that it is necessary to encourage fuel economy among consumers, as if people need to be enjoined to observe fuel economy with coal at 10s. 6d. a bag. That is enough to instil economy all over the country. But if we are paying that amount for


coal, we are surely entitled to be assured that we are getting the grade for which we are paying, and the consumer is entitled to protection from the Ministry which up till now has been sadly lacking.

11.0 p.m.

The Parliamentary Secretary to the Ministry of Power (Mr. David Renton): May I say, first of all, speaking for my noble Friend and myself, that we are glad the hon. Lady the Member for Coatbridge and Airdrie (Mrs. Mann) has raised this matter tonight. She has complained, in the first place, that the consumer has no protection when supplied with stones rather than coal or with a quality lower than the grade for which he has, in fact, been charged.
It is not accurate to say that the consumer has no protection. There are various forms of protection, and I shall remind the hon. Lady of them. In the first place, there is the Domestic Coal Consumers' Council, which was established under the Coal Industry Nationalisation Act, and which has done extremely valuable work in protecting the interests of consumers. The Council is fairly representative of the different parts of the country, and I invite the hon. Lady's attention to the last of its Reports wherein the Council points to the procedure which the hon. Lady mentioned for the making of complaints by the consumer to the merchant and by the merchant to the colliery. The Council points out that the essence of success in making such complaints is that they should be made as promptly as possible.
Another form of protection which the consumer has is one of which too few consumers avail themselves, but of which, or of the threat of which, the hon. Lady, if I may say so—we admire her for it—was right to avail herself. That is the threat of civil action. It is not so much a common law remedy, because the common law was embodied in the Sale of Goods Act, 1893, and, under that Act, there are various implied conditions which form a great protection for the consumer.
There is the further protection provided by prosecution under the Defence Regulations. It is to that principally, that I invite the hon. Lady's attention, because that, I think, really is the most effective method of consumer protection

that there is, in spite of what she has said. I hope to show here that that is so by describing the work which is, in fact, being done.
The hon. Lady's suggestion is that local authority inspectors of weights and measures should be appointed everywhere in the country—she wishes it to be general—so that our Ministry inspectors may be helped in enforcing the observance of Defence Regulations. In support of her suggestion, she argues, first, that the practice of upgrading is widespread, and, secondly, that since the local authority inspectors at Bradford were given the powers which she wishes other inspectors to have the number of prosecutions has gone up. Thirdly, the hon. Lady argues from that point that the local authority inspectors of weights and measures should everywhere have the powers which our Ministry inspectors have under Defence Regulations.
The practice of upgrading certainly has caused trouble in certain places, mostly in certain large towns, but I assure the hon. Lady that, according to our information, it does not happen everywhere and is not even widespread. As to the Bradford experiment, it is quite true that more people have been prosecuted in Bradford since eight, I think, of Bradford's weights and measures inspectors were given warrants under Defence Regulations but, surely, that shows that we were right to give those powers in Bradford, and that it was necessary for them to be given there. It does not follow that it is necessary to extend those powers over the whole country.
Let us just consider what happens under the present law. Under the Weights and Measures Act, the local authorities have power to prosecute only when coal is delivered at short weight. About that, the hon. Lady is perfectly correct. That does not apply, however, to coke, and there is power to prosecute for short weight coke only when the local authority has taken powers under a private Act. Defence regulations, however, apply to both coal and coke. It is an offence under Defence Regulations for a merchant to deliver to a consumer or for a consumer to take more than the maximum permitted quantity of house coal for the area of the country in which the consumer lives. That is proved by the checking of the merchants' records of deliveries.
It is also an offence under Defence Regulations for the merchants to charge more than the maximum retail price for the grade of coal, and a schedule of prices is published for each region. To enforce those Regulations and to prosecute for those offences, warrants are issued to give our Ministry inspectors power to do things which, quite honestly, we should not lightly give and would not give unless really necessary, namely, to enter and inspect merchants' premises and to require merchants to give information and to produce records.
Those are fairly stringent powers. They are conferred by emergency legislation, and I would remind the hon. Lady that, under the Supplies and Services (Transitional Powers) Act, 1945, by virtue of which Regulations can be extended annually, and have been for coal rationing, those powers can be used only when the Minister is satisfied that it is necessary or expedient to use them. The enforcement staff of the Ministry of Fuel and Power—now the Ministry of Power—has never, since the beginning of coal rationing, exceeded 50 officials for the whole country. At this moment the number is just under 50. Each inspector has a fairly large area, but they keep at it pretty assiduously—

Mrs. Mann: Does the hon. and learned Gentleman understand that that is one of the reasons why I complained of lack of contact? Each inspector covers such a wide area that the consumer cannot get in touch with him.

Mr. Renton: Perhaps the hon. Lady will listen to what I am going to say about this. They keep going pretty assiduously, and last year nearly 20,000 checks were carried out by those inspectors on coal merchants' delivery men, and 10,000 checks were made of merchants' records of retail sales. In the past three years the work of our Ministry inspectors alone, leaving aside help from local authority inspectors, has resulted in prosecutions for over 500 offences against coal control orders, of which 400 were for price offences and 41 of those were in Bradford. Also, the inspectors sent out 450 warning letters, 250 of which were for price offences.
In spite of all that work which is being done by our Ministry staff, we do

acknowledge that there are particular places where, owing to clear evidence being given of malpractices by a minority of merchants or their employees, our inspectors need to be helped by local authority inspectors, and that is why we have issued warrants under Defence Regulations to local authority weights and measures inspectors at Bradford. Glasgow, Manchester, East Ham and in Kent. We have refused the applications made by four local authorities and the applications of four other local authorities are now under consideration.

Mrs. Mann: I just wanted to ask if the three following Glasgow and Bradford had been given recently.

Mr. Renton: Bradford and Glasgow were, if I remember rightly, both appointed early in 1955; Manchester earlier this year, and Kent and East Ham fairly recently.
It should be borne in mind that these are powers for the exercise of which my noble Friend is responsible. One would expect that it would be his own officials who would exercise them and that they should not be extended lightly. Therefore, we consider carefully in each case put to us whether there is need to extend them. We consider the local evidence and consult closely with the local authority through our regional officer, who has acquired a very great deal of local knowledge about the need of our inspectors for help.
The hon. Lady mentioned that the chief inspector from Bradford quoted a Ministry official, mentioned anonymously, showing that enforcement by the Ministry was never more than a gesture. I deny that. That is obviously quite wrong, from the facts which I have given about the number of checks made and the number of prosecutions by Ministry officials. The hon. Lady also said that she knows of an official, again anonymously mentioned, who said that Ministry officials do not know the difference between different grades of coal.
Let me be the first to concede that it is not easy to judge by a quick, superficial examination to which grade a bag of coal may belong. It is necessary to make a detailed investigation. We have found by nearly fifteen years' experience


of the operation of the Defence Regulations that the powers under the regulations to inspect records, and to get right to the bottom of the matter by finding what the merchant has to say and by entering premises, is often necessary to check the grade.
I acknowledge that this is a difficult matter, and I acknowledge freely that there has been a considerable amount of public anxiety about it. I grant that the experience of a not very large but appreciable part of the coal consuming population

is not what they wish it to be, but among those who complain there are not so many who take the trouble to find out what remedies are available to them. I hope that as a result of what I have said tonight there may be a better understanding and for that reason I am grateful to the hon. Lady for having raised the matter tonight.

Question put and agreed to.

Adjourned accordingly at fourteen minutes past Eleven o'clock.